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JAN 2017 RM7.50(WM) RM9.00(EM)



A brand new dawn for 2017!

Dato’ KK Chua, Editor-in-Chief


t’s already 2017, and already the first few days of the year are brimming with promise and full of potential for the exciting year ahead. Let me begin by extending a warm and hearty welcome to our industrious readers, it is a privilege to usher in the new year with each and every one of you. However, let’s not forget what an electrifying year 2016 has been, especially for us here at Property Insight. Last year, we saw the materialization of a couple of significant events – Property Insight Prestigious Developer Awards (PIPDA), Property Investment Summit (PRISM), the inaugural Entrepreneur Insight Summit and culminating to a wondrous finish with our first ever 100 Most Influential Young Entrepreneurs Awards (100 MIYE). The wheels are set in motion for a great 2017, with fresh eyes to take on the new year. This month’s issue dives right into discerning the prospects of what to expect in 2017, with many features highlighting market trends and understanding key influential paradigms that may shape the way the year may unfold. Finding out how the property landscape will unravel within the year, is going to be an exciting and thought-provoking journey. Proudly featured in our Cover Story of the month is prestigious developer Marvelane, as they emerge into the new year with new

insights on their current M360 developments, alongside 2017 market projections and tips as highlighted by Marvelane managing director Ir Ong Choon Hock. Our Featured Property section goes headfirst into charismatic developer Rivertree Group, led by its industrious managing director and CEO Dato’ Simon David Leong, as the team takes on the new year with an exciting new project within the Bukit Raja vicinity. The stakes are indeed high for these two assiduous developers, setting the stage for a powered 2017. As our Personality of the Month, we have none other than the lovely Nur Fazura. Learn more about this entrepreneurial media businesswoman and her ideas on what makes an efficient investor, from a valuable viewpoint of an external industry key player. There will be a lot of insight, so to speak, that will be gleamed from this month’s issue. Valuable inputs from key opinion leaders, to movers and shakers within the industry will provide much food for thought. I truly hope that our January issue will spark a catalyst for many new ideas, and being a supporting factor for others. With that in mind, here’s to an illuminating take on 2017, with a fire in your hearts and your heads held high! Insight Malaysia

Property Insight Malaysia


Although every reasonable care has been taken to ensure the accuracy of the information contained in this publication, neither the publisher, editors, writers nor employees or agents can be held liable for any errors, inaccuracies and/or omissions. The contents of this publication do not constitute investment advice. It is intended only to inform and illustrate. No reader should act on any information contained in this publication without first seeking appropriate professional advice that takes into account their personal circumstances. We shall not be responsible for any loss or damage, whether directly or indirectly, incidentally or consequently arising from or in connection with the contents of this publication and shall not accept any liability in relation thereto. The views by our contributors expressed here are their personal opinions and do not necessarily reflect Property Insight’s views. The publisher does not endorse any company, organisation, person, investment strategy or technique mentioned in this publication unless expressedly stated otherwise. The publisher does not endorse any advertisements or special advertising features in this publication, nor does the publisher endorse any advertiser(s) or their products/services unless expressedly stated to the contrary. All rights reserved. No part of this publication may be reproduced in any form or by any means, including photocopying and imaging without the prior written permission of the publisher.

Editor-in-Chief Dato’ KK Chua Sub Editor Divya Prembaj Writers Mages PV Lingam Felicia Soon CREATIVE Creative Director Sarah Tan Designer Megat Khuzamir BUSINESS DEVELOPMENT General Manager Janet Loh +6012 205 0911 Andy Fam +6012 601 9938 Hagenz Choo +6012 371 8831 Iris Gan +6012 799 6685 Wei Yeen, Chong +6012 927 2863


Armani Media Sdn Bhd (1032085-H) No. 32-3, Jalan Pekaka 8/4 Seksyen 8, Kota Damansara 47810 Petaling Jaya, Selangor Tel : +603 6156 3366 Fax : +603 6156 3399 PRINTER Percetakan Osacar Sdn Bhd Lot 37659, No. 11, Jalan 4/37A Taman Bukit Maluri Industrial Area Kepong, 52100 Kuala Lumpur, Malaysia ENQUIRIES On the cover : Ir Ong Choon Hock, Marvelane Managing Director







• 7km Away From Bandar Malaysia • Walking Distance To LRT Station


• Excellent Connectivity With Highways • Mature Township With Complete Amenities • Ready Population Catchment

6016 - 411 5828 603 - 9173 9933


N 3.103069, E 101.714177 WWW.QUEENSVILLE.COM.MY

SALES GALLERY Level 6, Tower Block, Plaza Dwitasik, Jalan Sri Permaisuri, Bandar Sri Permaisuri, 56000, Kuala Lumpur


36 Seputeh: Soaring in the Heart of Kuala Lumpur Bustling with a never-ending lease on life


42 Nur Fazura, A Force of Nature to be Reckoned With 10 COVER STORY

10 Marvelane: Striving for Success on its Own Terms Enriching the property industry to new industrious statures

The young entrepreneur, businesswoman, and media mogul shares her views on life and a stellar career in the limelight


46 Trending Market Strategies Online and Digital Platforms Surging Markets into the Future


16 Selling Your House: Against All Odds Knowledge can save you from shortcomings


48 Begin with the End in Mind Kit believes a good research will yield better investment returns


20 EPF Withdrawal to Purchase a House Account 2 savings allows you to finance the purchase of a house

22 Extension of Leasehold Residential Land How to extend your lease for leasehold properties in Selangor and Kuala Lumpur

24 Knowledge on Industrial Space: A Real Estate Perspective Know-how for the next big thing in the market today

32 Buying Smart is Made Up of Common Sense Than it is of Genius

Buying below the market rate is not classified as buying an undervalued property

52 Home Away from the City City dwellers are now seeking affordable homes in the suburbs


56 Taking it Forward: Increasing the Value of Homes or Property Investments


58 Eric Cheng: Driving the Automotive Industry into Cyberspace

Co-founder of shares his ideas on cars, and his first home


60 The Altitude of Real Estate Investments in a Foreign Shore Investors from China have keen eyes to purchase in Thailand, seeing more buyers in forthcoming years


54 Think it is Easy to Make Money on Real Estate Investment? 64 Financial Management Think Again!

Here are the top five mistakes made by real estate investors collected from professionals involved in real estate investment


28 Ahead of the Game: Rivertree, A Beacon for Tomorrow Prolific developer sets its sights on the affluent Bukit Raja township, merging timeless values with modern inflections

66 The 4W’s and 1H in Financing your Home Purchase STRATEGY

68 Budget Malaysia 2017 70 Taking a Closer Look at Financing Models for House Purchases 72 Know If and When to Ask for More





un, skill and speed were the theme of the day at the inaugural 2016 P1 AquaX (pronounced Aqua Cross) Malaysia Series held at D’Island Residence, Puchong recently. Malaysia is the first Asian stop in the international calendar for P1 AquaX. The 2016 P1 AquaX Malaysia Series is a collaborative effort between property developer and advocate of motorsports, Misi Aktif Sdn Bhd (a wholly owned subsidiary of LBS Bina Group Berhad) and P1 Marine Motorsports (Malaysia) Sdn Bhd (P1 Marine Motorsports). The collaboration is aimed at creating an avenue to discover local water sports talent and promote competitive water sports events in Malaysia, an aspect that is lacking in Malaysia. The competition kicked-off with the first round held on 29 and 30 October 2016 at the Kepong Metropolitan Park. The second and final rounds took place on 26 and 27 November, and 10 and 11 December 2016 respectively at D’Island Residence, Puchong.

“LBS Bina has been a strong supporter of motorsports. Our love for motorsports dates back to our involvement with enhancing and managing the Zhuhai International Circuit (ZIC) in China. Complying with the highest international standards, ZIC has grown to be a home for Chinese motorsports since

1996, cementing the activity in the nation. Similarly, we see great potential in the 2016 P1 AquaX Malaysia Series and believe it is a good platform to nurture local talent and put Malaysia on the map,” LBS Bina Group Berhad Group Managing Director, Tan Sri Lim Hock San, said.




ah Sing Group Berhad (Mah Sing) was announced as Developer of The Year at the People’s Choice Award 2016, marking its third consecutive win in the same category. is Malaysia’s No.1 platform for all things property. “We are pleased to come away as Developer of the Year in this year’s iProperty People’s Choice Award. To be honoured with a hat-trick in this accolade shows great testament of the public’s trust in Mah Sing’s products. This is what keeps us motivated to continue to bring our brand to new heights for the rakyat.” said Tan Sri Dato’ Sri Leong Hoy Kum, Group Managing Director of Mah Sing Group Berhad. Receiving the award on the Group’s behalf, Mah Sing’s Chief Executive Officer Mr. Ho Hon Sang said, “We would like to

thank our customers for their continued support and for the confidence placed in us over the years – ultimately, it is them who have made this win possible. This award is truly a testament of our commitment to remain customer-focused in the delivery of high quality products and sustainable

communities, and we will continue to build on this brand trust.” 2016 marks 22 years of the Group’s success in Malaysia’s property scene. Mah Sing has grown from strength to strength since its first township in Ulu Yam, Selangor back in 1994. JANUARY 2017 I 5




he Selangor State Development Corporation’s (PKNS) premium development arm DatumCorp International, today launched its sales gallery at 42 Jalan U thant which will feature its first development, Datum Jelatek; an award-winTning RM 1.2 billion gross development value (GDV) integrated development. The sales gallery, an investment of RM 4.5 million, will showcase its first project, Datum Jelatek, from the Datum Series, a collection of mid-to-high end commercial, residential, retail and mixed property developments, which will act as socioeconomic catalysts for its surrounding communities. At the launch, PKNS’s General Manager, Puan Hajah Noraida binti Haji Mohd. Yusof, said that the development encompasses sustainable practices for environmental, social and business opportunities, and

focuses on enhancing residents’ sense of belonging. “We are confident that Datum Jelatek’s superior connectivity, strategic location, architecture and value as an investment, will bring about the development’s success, ” she said. The event also marked the opening of the pre-registration for the development’s Ayaana Tower, one of its four residential towers, comprising studio units, onebedroom and two bedroom suites, within 41 stories.


accountability. “For 42 years, we have built trust with the Group upon a reputation of integrity. We are truly humbled to be receiving the awards for the 10th year and the awards serve as a testimony for our continuous endeavour in adopting the highest standard of disclosure, transparency, corporate governance and corporate

NACRA 2016


unway Group, Malaysia’s leading conglomerate with core interests in real estate and construction has once again, clinched two Industry Excellence Awards at the National Annual Corporate Report Awards (NACRA) 2016 for two categories- the Properties and Hotel category (Sunway Berhad), and the Real Estate Investment Trusts (REITs) & Investment Funds category (Sunway REIT), as well as a Certificate of Merit (Sunway Construction Group Berhad). This is Sunway Berhad’s 10th consecutive win, and Sunway REIT’s fifth consecutive win in their respective categories. NACRA is a collaborative effort of Bursa Malaysia Berhad, Malaysian Institute of Accountants (MIA) and The Malaysian Institute of Certified Public Accountants (MICPA). NACRA has been the epitome of corporate reporting excellence and

6 | JANUARY 2017

reporting excellence. We attribute our success throughout the years to the unfailing support we have garnered from our stakeholders which has been built on the foundation of strong corporate governance, and fair, transparent and informative corporate reporting,” said Dato’ Chew Chee Kin, President of Sunway Group.



he Human Resources Development Fund (HRDF) or Pembangunan Sumber Manusia Berhad (PSMB) hosted their annual flagship event, the HRDF Conference and Exhibition 2016, across two days from December 6 - 7 at the Kuala Lumpur Convention Centre (KLCC). The conference was officiated by Yang Berbahagia Dato’ Sri Adenan Bin Ab. Rahman, Secretary-General of Ministry of Human Resources. As part of efforts to deliberate on the power and potential of Malaysian employers, employees and training providers, the conference was conceptualised based on global human capital trends that focused on four learning tracks – leading; engaging; re-inventing and re-imagining. The Conference witnessed the participation of over 20 industry experts – locally and from abroad that took on key roles as speakers, panellists and moderators.

“The availability of a highly skilled workforce that has global competitiveness is pivotal to support a knowledge-intensive economy and improve labour productivity that is expected to increase by 3.7%. HRDF will continue to support the National Development Agenda of achieving a 35 per cent skilled Malaysian workforce by the year 2020,” said Dato’ CM Vignaesvaran,

chief executive officer of HRDF. “We hope through our flagship event, we will be able to bring down Malaysia’s unemployment rate; reduce the nation’s dependency on foreign expertise for skilled jobs; and equip Malaysian workers with skills that are in demand by the industries,” he added.



amuda Land has officially launched its highly-anticipated new residential development, Kundang Estates. Close to 100% of all units in Phase 1 were taken-up by the launch day, showing the appetite of potential homeowners for the taste of modern countryside living that Kundang Estates offers. The 90-acre Kundang Estates is part of a larger 910acre development in Sungai Buloh North, which also comprises of Gamuda Gardens. Ideally situated at the intersection of three major highways – North-South Highway, Guthrie Corridor Expressway and the Kuala Lumpur-Kuala Selangor Expressway (LATAR) – Kundang Estates and Gamuda Gardens are poised to be prime locations just a short, easy drive away from Kuala Lumpur. The locations’ proximity to the Kuang KTM station and the Sungai Buloh Integrated Transport Hub (MRT) exponentially increases its accessibility,

linking it not just to the city centre, but also the rest of the nation’s transportation network. Guests at the official launch enjoyed a fun-filled day packed with engaging family activities which include a petting zoo, photo booth, and children’s colouring area. Potential homeowners also tried their hand at recycling used cups into planter pots, before planting a seed and taking a slice of the countryside home with them. On display at the launch were 2 showhouses,

allowing interested buyers the chance to imagine themselves and their families at home in Kundang Estates. Lucky members of the public who purchased a unit at the launch had the chance to win purchase vouchers of RM188,000 off the cost of their new home. Homes in Kundang Estates range from 1,733 to 2,434 sq ft in size, and begin at RM570,000. They are situated to take advantage of the beautifully-landscaped views, with units overlooking the parks and lake. JANUARY 2017 I 7





he spirit of giving has come in the form of working with Mother Nature, as IJM Corporation Berhad held its annual Give Day Out (GDO) 2016 recently in conserving and developing the greenery and environment of the S2 Trail, Seremban 2’s nature trail for the Seremban community during the festive month of December. An annual event since 2011, IJM Give Day Out (GDO) involved all employees from all divisions across Malaysia, India and China to participate in carrying out CSR initiatives of their choice together for one day, with the main focus for this year being environmental preservation. Mr Hoo Kim See, Senior General Manager of IJM Land (Central Region) said that this event is in line with IJM Land’s strong commitment in “Bringing Life to Ordinary Space”, elevating the standards of living and quality of life of the communities they operate in. “This year, we would like to raise awareness of the environment, exposing to

our people how we can make Seremban 2 - along with every IJM Land developments - livable and, at the same time, appreciate the idea of living among greenery that would emphasize individual’s life to be healthier and joyful; uplifting the spirits of our residence,” said Mr Hoo recently at the development site. “Our business has always revolved around developing communities. Serving these

communities through CSR engagements is part of IJM Land’s Sustainability agenda, and caring for the environment and local communities are the key focus of our sustainability framework,” said Mr Hoo. Currently S2 Trail is not open to the public yet, however the project will estimated be ready by end of 2017. An official announcement will be made to the public once the entire trail has been developed.


of CHUR Associates. Sheldon Fernandez, Country Manager of PropertyGuru Malaysia moderated the session. Aside from the property market, the panellists also shared frank views on Budget 2017 and its implications to the Malaysian economy and property sector, as well as recent global developments that have impacted the value of the Ringgit Malaysia (RM). “Based on the combined data from the PropertyGuru Property Price Index and official statistics, 2017 is expected to be another slow year for the property market. With the completion of many new developments flooding the market in 2017, there is likely to be a drop in selling price due to the lack of demand; and some may be motivated to move their units quickly due to their lack of holding power,” shared Sheldon Fernandez, Country Manager of PropertyGuru Malaysia. Among the highlights for the event include the launch of the PropertyGuru Property Price Index. It tracks the asking prices of properties in Malaysia – providing house

buyers with greater price transparency based on key variables such as location, unit size and unit type (landed or highrise), freehold or leasehold and so on. The projects under “Lock and Roll” offer different property options for different buyer profiles. For landed properties, buyers with expanding families looking for larger built up homes can consider Aspen @ Residence, Cyberjaya. Aspen @ Residence, Cyberjaya offers 9 bedrooms and 9 bathrooms and is priced from RM3,450,800.



ringing together a distinguished panel of industry experts and speakers, the PropertyGuru 2017 Property Outlook Forum provided much needed insight on the prospects for the Malaysian real estate sector in 2017, especially on the conditions of residential properties given the current challenging scenario that the nation finds itself in. The Forum also saw the launch of the PropertyGuru 2017 Property Outlook Report. Panellists for the PropertyGuru 2017 Property Outlook Forum consisted of Dato’ Charon Mokhzani, Managing Director of Khazanah Research Institute (KRI), Datuk Seri FD Iskandar, President of the Real Estate and Housing Developers’ Association Malaysia (REHDA), Prem Kumar, Executive Director of Jones Lang Wootton, Gary Chua, CEO of SMART Financing and Chris Tan, Managing Partner

8 | JANUARY 2017




ringing together a distinguished panel of industry experts and speakers, the PropertyGuru 2017 Property Outlook Forum provided much needed insight on the prospects for the Malaysian real estate sector in 2017, especially on the conditions of residential properties given the current challenging scenario that the nation finds itself in. The Forum also saw the launch of the PropertyGuru 2017 Property Outlook Report. Panellists for the PropertyGuru 2017 Property Outlook Forum consisted of Dato’ Charon Mokhzani, Managing Director of Khazanah Research Institute (KRI); Datuk Seri FD Iskandar, President of the Real Estate and Housing Developers’ Association Malaysia (REHDA); Prem Kumar, Executive Director of Jones Lang Wootton; Gary Chua, CEO of SMART Financing and Chris Tan, Managing Partner of CHUR Associates.

Sheldon Fernandez, Country Manager of PropertyGuru Malaysia moderated the session. Aside from the property market, the panellists also shared frank views on Budget 2017 and its implications to the Malaysian economy and property sector, as well as recent global developments that have impacted the value of the Ringgit Malaysia (RM).




ah Sing Group (Mah Sing) held the first preview of D’sara Sentral’s final tower, OLO Serviced Residence last weekend. The preview received encouraging responses from the public with the overall development recording 81% take up rate. The OLO Serviced Residence tower of D’sara Sentral has a total of 197 units with built up starting from 782 sq ft. The starting price of the units are from RM603,000. One of the factors that contributed to the positive take up rate is the convenience of accesibility. The development falls under MRT Line 1, Kampung Selamat Station which has commenced operation on 15 December. This enables the development to be easily accessible by visitors and residents.

“Based on the combined data from the PropertyGuru Property Price Index and official statistics, 2017 is expected to be another slow year for the property market. With the completion of many new developments flooding the market in 2017, there is likely to be a drop in selling price due to the lack of demand; and some may be motivated to move their units quickly due to their lack of holding power,” shared Sheldon Fernandez, Country Manager of PropertyGuru Malaysia. Among the highlights for the event included the launch of the PropertyGuru Property Price Index. It tracks the asking prices of properties in Malaysia – providing house buyers with greater price transparency .

Ho Hon Sang, Chief Executive Officer of Mah Sing said, “The MRT service will be an added value for the retail component of D’sara Sentral as this convenience puts the development at a high visibility with a ready catchment of residents as well as nearby community. Residents will also benefit from this service as it provides easy accessibility from their home to various parts of the city. “We are very thankful for the support from our customers. Our Mah Sing brand will continue to put utmost importance in exceeding customer’s expectation and deliver high quality products,” Ho continued. A covered walkway will be built to provide a direct access and shorten the walking time to the MRT station to only 3 minutes. Construction of the walkway is expected to be completed by June 2017. D’sara Sentral is an integrated development with both residential and commercial components. It has a gross development value (GDV) of RM911 million that stands on 6.55 acres of land. JANUARY 2017 I 9



STRIVING FOR SUCCESS ON ITS OWN TERMS Enriching the property industry to new industrious statures BY: DIVYA PREMBAJ


n this constantly shifting industry of property development, the competition is stiff, allowing for companies to take a healthy look at their own progress and development within the industry. To stay relevant within the game, diversification and evolution of the company’s brand is vital, elevating their status and name on an already crowded platform. Marvelane is one such company that is ahead of the game, with a stellar portfolio of projects and developments that will inherently carry the company into 2017 with a bang. FOUNDATIONS LAID IN ENGINEERING 1989 saw Marvelane planting its earliest roots in engineering, as a consulting engineering firm (civil and structure). Through countless years of immersion in the property industry, the young company had worked and associated itself with many top developers, building an impressive networking portfolio that inherently led to its solid induction into the property industry. The company began property investment in 1998, and has currently invested in over 100 properties to date. By discerning the demands of purchasers during the earlier days, it allowed the attainment of vital seed money, a crucial aspect for the company at that time to increase its credibility in order to borrow from financial institutions for its property development plans. With its rapid ascension in the property industry, Marvelane moved to property investment in 2010, cementing its roots. GOING FULL CIRCLE WITH M360 By understanding market demands and needs, Marvelane poised itself in incorporating the latest technology, methodology and innovation that spurred the property industry within a modern and urbanised landscape. Comprised under the industrious concept of M360, the company developed a one of a kind holistic approach in the planning, designing and building of its developments, as affirmed by Marvelane managing director Ir Ong Choon Hock.

10 I JANUARY 2017


COVER STORY “Marvelane provides building materials and products that appreciate in value, setting it apart from other developers,” he asserts. The following eight fundamentals were taken into consideration, making up the essence of M360: 1. Ambience 2. Location & Accessibility 3. Amenities & Facilities 4. Security & Community 5. Sustainability 6. Design & Technology 7. Quality 8. Fair value ACHIEVEMENTS UNLOCKED Marvelane prides itself in establishing projects of a high calibre, as seen with its biggest success story – Marvelane Square. Located at Jalan Meru in Klang, the development consists of a commercial centre with 3-storey semi-detached and bungalow shop offices, accompanied with its own carparks. Launched in 2011, it boasted the most expensive shop offices on the market back then, costing slightly more than RM3 million. Due to its strategic location and efficient planning, the company achieved 100% sales within 9 months, with profits earned at 60% higher than conventional developments. The project was completed in 2013, and is currently 80% occupied. However, as with most success stories, the company did face many challenges in its rise to glorified heights. It is these challenges and trials that have inherently shaped and moulded the prestigious developer to the company it is today, with class that denotes its charisma.

ROCKY ROADS As with all developers, consumer confidence was the key issue faced due to the imposition of GST, RPGT and the removal of DIBS. Apart from that, high household debts (88.9%) resulted in Bank Negara’s introduction of more stringent conditions for loan approvals, resulting in a reduced loan approval rate. The value of the Malaysian Ringgit that was affected badly by the 1MDB scandal and worldwide publicity on corruption in Malaysia resulted in inflationary pressure, that inherently affected property purchasers’ trends in property consumerism. Marvelane’s managing director Ir Ong Choon Hock believes that consumer confidence will be improved in the first half of 2017, allowing for property purchasers to hit back into the market in the coming new year. DIVING INTO 2017 Marvelane’s current project, Marvelane Homes By The Lake, is set to be a defining chapter in the company’s profile. Located in the affluent Putra Heights, the project boasts high connectivity to four major highways - New Klang Valley Expressway (NKVE), Damansara-Puchong Expressway (LDP), Shah Alam Expressway (KESAS), and North-South Expressway Central Link (ELITE Highway). Due to the current poor market sentiments, Marvelane is taking a step forward for its target audience, by providing bridging loans to the first 20 purchasers at their Phase 1 development of Marvelane Homes By The Lake. For the upgrader, approximately two and a half years are

With the seed money created from boutique development, we hope to move into a township development in the future.” - Ir Ong Choon Hock

Payment Stage




Amount (RM)


Developer Discount 7%

Bridging Loan

End Financier


Signing of agreement








Works below ground








Structural framework







2(c) & onward

Walls, Roof/ Ceiling, Internal & External finishes etc.














-Table above indicate the payment from purchaser, developer and end-financier for Semi-Detached 40’x80’ - Max financing from developer 20% (to be payback before CCC) * Terms & conditions apply

12 I JANUARY 2017


NAPIC’s (National Property Information Centre) data indicate a long term annual appreciation for landed semi-d property at 6.0% - 6.5%.

Additional construction cost of 10.8 million had been incurred in compliance with the standard & feature of M360

The quantum appreciation is 10%-15% with good connectivity in road system and LRT-line.


With the selling price of RM 500/sqft for our landed development as compared to RM 600700/sqft for the condo, the future price of our landed development should have a higher rate of appreciation.

The site is located in a matured and affluence neighbourhood with Chinese school, private college and university, shopping malls, hospitals, amenities and facilities

Capital Appreciation Min %

Max %

Landed Properties



Additional Appreciation • Lake side development • Good connectivity • Matured & affluence neighbourhood • M360 compliance • Low selling price / sqft






RM 620,550.00

RM 689,500.00

Amount if Appreciation (2.5 years Construction Period)

given to the purchaser to sell the existing property. As for investors on the other hand, it is stipulated that approximately two and a half years are given to the purchaser to raise the necessary down payment for the properties (please see table below). A CLASS ON ITS OWN Marvelane strives to set itself apart from other competitors in the industry, with many differing features that conceptualize its best qualities. The determining factors that sets Marvelane Homes By The Lake apart from other developers include: 1. A 16-acre lake with Class 1 water quality. M360 was introduced to

ensure that water quality is maintained at Class 1 at all time. 2. Good connectivity to major highways (NKVE, LDP, KESAS, ELITE), with an LRT station that lies 500m away. The quantum appreciation is 10%-15%. 3. Conducive location in a matured and affluent neighbourhood with a Chinese primary school, private college and universities, shopping malls and hospitals. 4. Audited by Feng Shui master Dato’ Joey Yap, Bukit Cermin serves as the main mountain for the site and it is further embraced by the internal green dragon and white tiger (armchair

formation). The beneficial Qi is then generated and tapped in the lake and this results in: a. The presence of a lake at the south west corner of the site augurs well for wealth accumulation for period eight (2004-2023). b. The presence of Bukit Cermin at the south sector provides opportunity for status, power and recognition. The low-lying area where Qi is accumulated also provides opportunity for wealth accumulation for period nine (20242043). JANUARY 2017 I 13


Maintaining a good credit rating with financial institution.

Prepare yourself psychologically for property investment.

Method of creating or raising the seed money for property investment.

Marvelane’s 5 personal tips for property buyers in 2017

Know the micro factors affecting the values of the property.



Know the macro factors that affecting the supply and demand of property.

% of GDV

Future Price Trend


Land Cost

18% - 21%



Construction Cost

42% - 45%



Financing Cost

7% - 8%



Compliance Cost & Professional Fee

16% - 18%



83% - 92%

Developer’s Profit

8% - 17%

FUTURE MARKET TRENDS – WHAT’S EXPECTED Marvelane knows that the two questions that are currently circulating the property roundtable, is when will the property price come down; and when is the right time to emerge into the market. To digest these queries, the cost structure of a 14 I JANUARY 2017

development must be fully comprehended. • Land cost will trend upwards due to shortage of land for development in big cities and urban migration. • Construction cost – will trend upwards due to GST and labour shortage. • Financing cost – will trend upwards as the U.S. is expected to increase

interest rate. Compliance cost & Professional Fee – Compliance cost will trend upwards (5% in 2008 to 13% in 2016) and Professional fee will also trend upwards due to inflationary pressure. Based on Marvelane’s property cycle study and intermarket analysis, the •


present consolidation is mid-cycle consolidation, with the drop of property prices not as severe as the end property cycle consolidation. The duration of the consolidation should be shorter than the end cycle consolidation

WHAT’S IN STORE FOR MARVELANE IN 2017 With a deep understanding of the current property market trends and aesthetics, Marvelane are poised to take on 2017 with a good head on their shoulders. “We would like to be a boutique developer when we develop our existing land banks. With the seed money created from boutique development, we hope to move into a township development in the future,” Ir Ong affirms with a contented smile. Marvelane are well on their way to cementing its name in the annals of property history. JANUARY 2017 I 15


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AGAINST ALL ODDS Knowledge can save you from shortcomings BY: MAGES PV LINGAM JANUARY 2017I 17



he prospect of selling your house in the coming months can be a crucial decision to ponder upon even though you are pushed to do so beyond unimaginable circumstances, especially with the uncertainties in the property market now. It is clear that for every sale missed because you are too enthusiastic, you will miss a hundred because you’re not enthusiastic enough. This is true enough as it will only be ethical for people who are investors to abide by these words, to cross over the winning line with endurance in order to beat the odds. Leverage Lab founder, Jeevan Sahadevan said houses on sale have the biggest challenge especially when you have the thought of hiring a property agent at the back of your head. John Lee, the cofounder of Wealth Dragons, commented that most people don’t like to be sold to, but prefer to buy. There are three constructive tips involved in selling a house, as practised by John over the years. Firstly, concentrate on the people who want to buy or push marketing, it is imperative that the seller listens to the buyers. Not just hear, but listen to what they want/need. Selling is a service, do not be afraid to sell because there is where you

18 | JANUARY 2017

will get what you asked for. It is part of a property salesperson’s duty to know that their task does not just involve selling, but serving the clients as well. On the other hand, if you have decided to sell it personally, then you need to be on the dot with the data of your house, in order to take on a good sales bargain or winning the buyer over with your charm. Anyhow, when you have made up your mind, there are a few criteria to be adhered to as well. There is some nitty gritty work needed to be done before you place your house for sale. A house needs to be in a condition where the new purchaser may be able to move in immediately. Any renovation or small improvements should be considered and not be left for the new owner to lodge a complaint on a later stage of the sales agreement. Sam Helmy, chief executive of Neovate Developments Sdn Bhd affirmed that sales fails when we fail to understand the values in giving and helping the buyers. Most sellers get trapped with hard selling to meet their targets in other terms, to sell above the listed market price. The solution would be based on what the desired buyer needs. If you have hired an agent to tackle your need to sell a property,

then questions are a fundamental factor to determine how far your house can move forward in the market. Jonathan Quek, founder of Owners Circle states “That most property consultants were commission driven. Therefore, choose the right one with bargaining skills to skew to your desired selling price,” TOP STRATEGIES When the moment to sell your house has arrived and buyers have started calling or knocking at your door to view, initial preparation especially on cleanliness, beautification or renovation should be the forerunner to determine lay a positive and good first impression. The house should be tidied up, get rid of excess clutter; clean windows inside and out, and replace any broken light bulbs. Making the place feel light and airy has the ability to make rooms feel bigger and the property more attractive, give it a fresh splash of light coloured paint; fix those little snagging things and keep it spick and span for the viewers. In addition, good interior aura can make a property feel like an alluring home too. Social media strategies like Facebook, LinkedIn, YouTube, Google, Twitter,

“Everybody is hooked onto social media now, as it allows a wider market capture through this media. Digitally, if you are on social media, you are everywhere,” - John Lee

Instagram and Snapchat have never failed to reach the buyers’ market. The co-founder of Wealth Dragons, John Lee has pressed on that everybody is hooked onto social media now, as it allows a wider market capture through this media. John added “Digitally, if you are on social media, you are everywhere,” If your property is located at a remote area or quiet suburb, you would probably need to do extra homework to let the people know you exist in the market. Sam reiterated “But one workable strategy that I practiced was referrals, growing your contacts inadvertently,” A good relationship would be referral marketing, and the best salespeople would be the referrals themselves- be it your relatives, working colleagues or simply friends. A smart way to dispose your property for sale is to decide what price to sell it for, though one of the most agonizing decisions when selling your home is what price to tag it in the market. Concurrently, you must do your research and get to know the local property market inside out. It is also wise to get estate agents to do the valuations, and after that buyers will probably try to negotiate a discount, so add 5% - 10% to what you are prepared to accept.

- How lucrative is the location of the property, in terms of appreciation in the market? The new generation of buyers are also concerned about wide area network telecommunication lines over a large geographical area. The buyers would be attracted to fast and efficient network lines as it will increase the value of your sales aptly. In order to succeed the sales of a house, you need to build a unique selling proposition which makes it stand out from the rest. For instance, the townships of Bangsar South and Cyberjaya have become hotspots since the inception of the multimedia super corridor (MSC) status to its residential and commercial lots. Significantly, few have high confidence, but if you understand and focus on the specific need for the buyers along with the communication between the seller, the agent and buyers, you will inherently have a higher success rate. National Property Information Centre (NAPIC) has given a breakdown of houses sold within the Federal Territory of

Kuala Lumpur in percentage in value of transactions by price range for the principal property sub-sectors with a total of: - RM2.5million in Q3Y2015 - RM2.0mil in Q2Y2016 - RM2.04mil in Q3Y2016 and a percentage breakdown of - 34.5% in Q3Y2015 - 34.3% in Q2Y2016 - 41.2% in Q2Y2016. *Information per se will benefit the seller to gage the value of transactions by price range for not to bargain below the market price. National House Buyers Association (HBA) has significant information related to concerns voiced out and asked of from the sellers and buyers as information that is relevant and vital to make any decisions. Information like sales and purchase, tribunal for homebuyers claims, defects mechanism, insurance and more would serve the parties related in the process as it has quoted that investment in knowledge pays the best.

ATTRACTIVE POINTERS One pointer is to conquer is the buyer’s mindset. Jeevan asserts that what makes a business stand out from the rest are its unique selling points (USP). If you are doing a business, you should be better and do something better than others, giving yourself room to stand out. The same technique can be utilised for selling houses too. Question yourself with the following : - Has the house on sale brought values to the buyers? - Is it worth the selling price? - What accessibilities are available for the buyers? JANUARY 2017I 19



WITHDRAWAL TO PURCHASE A HOUSE Account 2 savings allows you to finance the purchase of a house. BY: FELICIA SOON


f you are making an individual purchase for a house or shop house or any residential unit from a developer, and putting your name as the owner on the sale and purchase agreement (SPA) title, then you are eligible to apply for withdrawals


from Employees Provident Fund (EPF), as affirmed by Adrian Un, Chief Executive Officer of SkyBridge International. Datuk Shahril Ridza Ridzuan, Chief Executive Officer of EPF, officially states that as for the terms of withdrawal, your



purchase needs to be financed through a housing loan obtained from financial institutions or licensed insurance companies approved by the Central Bank of Malaysia, or is a cash purchase. The following table is the calculation sample:


Scenario 1: If a house price is RM500,000 and loan margin is 90%. Amount eligible to withdraw = RM500,000 x (10% (initial payment) + 10% of the purchase price)= RM500,000 x 20% = RM100,000

Scenario 1: If a house price is RM500,000 and loan margin is 90%. Amount eligible to withdraw = RM300,000 x (10% (initial payment) + 10% of the purchase price =RM500,000 x 20% = RM100,000

If an individual Account 2 has only RM50,000, the individual can only withdraw RM50,000.

If individual A and individual B have each RM45,000 in Account 2, they can withdraw all their Account 2, totalling to RM90,000.

Scenario 2: If a house price is RM400,000 and loan margin is 80%. Amount eligible to withdraw = RM400,000 x (20% (initial payment) + 10% of the purchase price) = RM400,000 x 30% = RM120,000

Scenario 2: If a house price is RM300,000 and loan margin is 80%. Amount eligible to withdraw = RM300,000 x (20% (initial payment) + 10% of the purchase price) = RM300,000 x 30% = RM90,000

If an individual Account 2 has RM200,000, the individual can only withdraw RM170,000.

If individual A and individual B have each RM50,000 in Account 2, they can withdraw up to RM45,000 each, totalling RM90,000.



If a house price is RM600,000, amount eligible to withdraw = 10% of the purchase price = RM60,000. If an individual Account 2 has only RM50,000, the individual can only withdraw RM50,000.

20 | JANUARY 2017



House price + 10% from the purchase price

An application for withdrawal may be made by submitting form KWSP 9C, together with the following documents:

Buy land and build house simultaneously


Public Auction


Signed sales and purchase agreement (agreement date is not more than 3 years from the date of application)

Sales agreement or proclamation of sale from Administrator/Court (agreement date is not more than 3 years from the date if application)

Signed sales and purchase agreement (agreement date is not more than 3 years from the date of application)

House construction agreement letter (agreement date is not more than 3 years from the date of application) SPA agreement of land (agreement date is not more than 6 months with the agreement letter for the house construction).

For loan borrower, they required to obtain a housing loan approval letter/loan agreement.

For loan borrower, they required to obtain a housing loan approval letter/loan agreement.

For loan borrower, they required to obtain a housing loan approval letter/loan agreement.

For loan borrower, they required to obtain a housing loan approval letter/loan agreement, land Title Deed in the landowner name and Power of Attorney letter registered at the Court.

For cash buyer, it require developer confirmation letter on the cash purchases, proof of payment of not less than 20% of the house price, architect’s certificate/ payment request letter to confirm progress of construction.

For cash buyer, it require a confirmation letter from lawyer office who manages the transaction, proof of payment of at least 20% of the house price and the Title Deed/Deed of Assignment in the name of the purchaser.

For cash buyer, it require a confirmation letter from lawyer office who manages the transaction, proof of payment of at least 20% of the house price and the Title Deed/Deed of Assignment in the name of the purchaser.

For cash buyer, it require developer confirmation letter on the cash purchases, proof of payment of not less than 20% of the house price, architect’s certificate/ payment request letter to confirm progress of construction.

According to James Wong, Director of VPC Alliance (KL), Account 2 provides first time home buyers with a convenient way to buy properties. “Assuming that you started working at age 22 with a starting salary of RM2,500, an average increment is 5% annually, 1 month bonus, your monthly EPF contribution is 11% and employer contributing 13% and annual EPF dividend is 5%. At the age of 35 years old, you would like to withdraw from your Account 2 to purchase a house at price of RM200,000, amount that can be withdraw from Account 2 is RM35,134

Name must be on Deed of Title for individual purchas.” - Adrian Un

(based on current Account 2 withdrawal margin of 30%), you will still need to pay an upfront of RM4,866. However, with the proposed Account 2 margin increased to

40%, the amount that can be withdrawn from Account 2 is RM40,000, which will enable you to purchase the house without any upfront,” says Wong.

Property purchase price


Loan margin (90%)


Amount needed for downpayment (10%) and SPA and loan legal fees and etc (10%)

RM40,000 (20% of property price) Current Account 2 (30%)

Proposed Account 2 (40%)

Balance in Account 2



Amount that can be withdraw


RM40,000 (Excess RM6,845 in Account 2) JANUARY 2017 I 21


EXTENSION OF LEASEHOLD RESIDENTIAL LAND How to extend your lease for leasehold properties in Selangor and Kuala Lumpur BY: FELICIA SOON


easehold tenures usually last 30, 60, or 99 years and there are restrictions to a leasehold land. For instance, land cultivation may be effectively barred by environmental and town planners. Also, what is detailed in the lease conditions will limit the type of activity that can be performed on the land. During the period of ownership, only the State or an equivalent can grant approvals for a transfer of lease, and once the lease 22 | JANUARY 2017

on a property expires, ownership is then reverted back to the State government. Extension or renewal of a lease can be done through an application, provided the State government grants an approval and the premium is paid. According to Chris Tan, Managing Partner at Chur Associates, “the extension of leases for leasehold properties is governed under Section 76 (a), 204B and 197 of the National Land Code (Act 56 of 1965)

pertaining to the applications for approval of surrender of the whole of the land, as well as the land rules of the various states. “Section 76 (a) gives power to the State Authority to alienate land of a term not exceeding 99 years. Section 197 of the NLC provides the procedure where the landowner may surrender their title back to the government. Section 204B provides certain power to the State Authority to approve surrender and re-alienation”,

explains Chris. Christopher Chan, Associate Director of Hartamas Real Estate (Malaysia) and registered real estate agent, affirms that the Selangor government has come up with two options for extending leases. Under the first, the homeowner need only make a payment of RM1, 000. However, this option comes with “restrictions”, as the owner is not allowed to re-sell the property to profiteers. Ivan Chan, Lawyer from Messrs Amir Toh Francis & Partners further elaborates that where an applicant chooses to pay the normal premium of RM1, 000, Form 5A NLC (Notice that land revenue is due) will be issued to the applicant, stating and requesting for payment of the following sums: - the first year’s rent payable in respect of the land, computed on the basis of the area approved, or previously approved, for alienation. The second option is to pay the full rate of premium that is required for the extension of the lease. With this option, the owner may dispose the property as soon as the new title is received. For both options, there is a further RM500 to be paid as contribution to the state’s cemetery trust fund, ‘Tabung Amanah Perkuburan’. The fund will enable the State Government to buy land for cemeteries. PROCESS OF LEASE EXTENSION The applicant (who is also the owner of the property) has to complete the Form ‘ButirButir Permohonan’ and to give the original title of the property, copies of your quit rent (cukai tanah), and assessments (cukai taksiran) receipts for the current year. The whole process may take approximately two years from the time of submission of the application, right up to the obtainment of the new title.

Homeowners can extend leases on their property according to their choosing, and there is no minimum number of years they need to wait before applying”

EXTENSION OF LEASEHOLD RESIDENTIAL LAND IN SELANGOR In Selangor, the formula to calculate the premium rate is derived from Section 7 of the Selangor Land Rules 2003 & Selangor Quarry Rules 2003, entitled “Premium”. Example – a 7,000 sf (land area) bungalow land with 45 years remaining (assuming valued at RM200 psf). Premium = ¼ x 1/100 x value of the land x (term of new lease minus balance of existing lease). ¼ x 1/100 x 200 x 7,000 x 54 = RM189, 000. After deducting 30%, you get RM 132, 300.

- Christopher Chan

EXTENSION OF LEASEHOLD LAND IN KUALA LUMPUR Formula ¼ x category of the land use x value of the land x 1/99 x (term of the new lease minus balance of existing lease). Example: land of 4,000 sq ft valued at RM 200 per sq ft with 35 years remaining. = ¼ x 4,000 x 200 x 1/99 x 64 = RM 129, 292.80 (premium to pay). JANUARY 2017 I 23



A REAL ESTATE PERSPECTIVE Know-how for the next big thing in the market today BY: MAGES PV LINGAM


alaysian Investment Development Authority (MIDA) acknowledged the importance of industrial growth in the country, being a key component to lift up the income of the nation. MIDA has quoted some key economic indicators with a total import of RM697.2 bil in 2016 compared to RM685.65 bil (2015). With this in mind, the manufacturing and storage industry boosted its market with 4.0-5.0% per capita income this year, in areas of electrical and electronics products, petroleum products, liquefied natural gas, machinery, appliances and more. THE FUNDAMENTALS Industrial spaces or lots have increased moderately based on the demand from multi-national companies (MNC) locally and abroad over the years and have increased the tenacity of adaptable infrastructures, storage facilities, industrial safety requirements and technologies, revolutionising and upgrading the standard proponents. Warehouses, manufacturing buildings, multi-use spaces are all considered to be industrial properties, whereby these spaces are utilised for product or goods manufacturing, storage and distribution. A formidable company specialising in warehousing solutions, LYL Group’s director of corporate development, Adrian Lim, emphasises that LYL Group has resolved many incompetencies faced by strategically planning and meeting the apt requirements of MNCs industrial standards. As the owner of more than 3.2 million square feet of industrial / warehouse space, LYL Group have counter challenged the indifferences 24 | JANUARY 2017

over the decades, to emerge stronger by building more functional warehouses to attract tenants. “We study the market needs, the functionalities, layout, shipping, loading bays, flooring, ceiling heights and so on. For instance, with one of our clients, hypermarket chain Mydin, its warehouse was built in U10 Shah Alam, with approximately half a million sq.ft. of warehouse space with 50,000 sq.ft. of cold storage facilities,” added Lim. Lim further added that warehouses are designed to facilitate changes in business growth. It must optimize the layout and configuration for the operation, space to provide adequate movement paths and material handling equipments like forklift

trucks. General warehouse should be floored with concrete slabs to withstand wheel loads and abrasions, energy efficiency light coloured roofing and ceiling mounted fans for proper ventilations. These are the norm for stationery built warehouses. WHAT IS IN STORE? According to the recently released Prologis Logistics Rent Index, Asia experienced a 3.0 percent industrial growth with the firm’s own holdings indicating that global industrial vacancy rates should remain low, and rents high, for the next several years. “A few long standing clienteles like DB Schenker, Linfox, H&M that are situated at U10 Shah Alam and Bukit Jelutong, and

Kumon at Subang Jaya, have trusted our support on client relationship programmes, meeting their industrial standard and requirements,” said Lim. Significantly, despite the soft market for the industrial space among business entities, Zerin Properties have phased out some challenges faced, by building industrial knowledge and fast to deliver via online strategy. “As consultants, MNCs will look out for people skills with adequate business knowledge. Some tenants may drag deals from months to a year for the parties to settle on tenancy, secure funding, paperwork and assume ownership, but leasing of these sites consumes less time,” said Windz Ng of Zerin Properties, merges and acquisitions - industrial space. Some of the frequently asked questions would be on location, the size of the space and its accessibilities, rates and requirements like ceiling heights, power supply, loading bays, fire fighting systems, certificate of fitness and any restrictions to run the business. Paul Poh of Zerin Properties said “Normally the term of tenancy would be two years, but the longest term can drag up to 15-30 years. Usually any internal or external modification varies between the landlord and tenant; a huge warehouse can be taken up on a project basis. Rental yields expected are 5-7% nett for this sort of spaces.” Having the right products near the

customer, means more points of distribution rather than a single point of distribution. Therefore, location and rental yield are commonly looked out for, followed by specifications. Some foreign investors prove also a challenge as the consultants need to guide them judiciously through the process till a contract is bound and fastened. Hence, Previnthran Singhe, CEO of Zerin Properties chipped in, “As for 2017, industrial properties build ups are flat but we see confidence in the movement that will pick up. The zoning for the spaces are divided into three categories - light, medium and heavy industries. The Department of Environment (DOE) will monitor the pollutant quotient, and department of occupational safety and health Malaysia (DOSH) will control the licensing process too,” POSITIVE SECTOR Klanggroup’s executive director, Danny Ong said ”Being involved in the manufacturing industry for a long time has inspired us to look for a niche market. Hence, we came out with an exclusive and sophisticated factory tagged with a comprehensive corporate image that was able to accommodate both local and foreign necessity.” “In earlier times, we faced acute challenges like land acquisition, the cost of building materials and increasing labour costs. Adhering to value engineering

Previn, Windz & Paul from Zerin Properties

Danny Ong, ceo Klanggroup techniques boosted Klanggroup in terms of cost reduction, value added to their clients, and inherently created a balance between initial construction costs, streamlining their maintenance cost and long-term operational cost of the development, “Danny added. He said that buyers were mainly looking at the property selling price, the builtup areas, land areas and the locations of the projects. The common built up for industrial spaces are all above 10,000sq. ft. He added a technology was used in maximizing the space for users technically via construction of non-suspended slabs on soft ground, well compacted earth hard layer and crusher run layer. Danny said “We are still optimistic towards the market in 2017. Despite the overall market performance softening, with the economy and politics among the key factors, there are still many developers launching new projects to cater to buyers’ interest.” Industrial space business makes up a significant source of income for the nation and increases the viability of manufacturing, import and export and steady investments in future. Even Kim Jong-un quoted that, “The industrial revolution in the new century is, in essence, a scientific and technological revolution, and breaking through the forefront is a shortcut to the building of an economic giant.” This is a sentiment that has now come as a realisation to many industry players. JANUARY 2017 I 25



RIVERTREE, A BEACON FOR TOMORROW Prolific developer sets its sights on the affluent Bukit Raja township, merging timeless values with modern inflections BY: DIVYA PREMBAJ

28 | JANUARY 2017


he property development landscape today in Malaysia is undoubtedly going through a defining phase, with the economy and the shrinking value of the ringgit inherently playing an important part, with many attributes to be taken into the factors that contribute to its current state. Developers push harder to assert themselves, through successes that create a platform for their name and developments. Rivertree Group is one such developer, encompassing their own values and multidisciplinary expertise in their projects. Its upcoming Signatures series within the Bukit Raja vicinity, highlights its unique traits, within a diverse industry. BEGINNINGS FOUNDED ON FAITH AND ENGINEERING Rivertree was established in 2003 as a design and build contractor, by managing director and CEO Dato’ Simon David Leong, along with his two right hand generals - executive director and COO Dato’ Kam Kok Kow, and Jennifer Woo, director of procurement and development. The company eventually vertically integrated into property development as a natural process, beginning with bungalows in Setia Eco Park. “I have known my partners for many years, as it is evident that friendship is the foundation of our relationships that organically branched out into partnerships,” Dato’ Simon adds.

GOALS STEEPED IN PASSION FOR PROPERTY The underlying passion that is shared with everyone at Rivertree is that they are not there to make money entirely for themselves. We focus not only on ourselves but also on our buyers and investors, who can purchase a property, which is unique, reasonable, yield orientated and therefore gets high appreciation from us. The desire for our buyers and clients to appreciate, understand our culture, follow and grow with us is an important factor, that sets Rivertree apart from other developers, says Dato Simon. “Property is our passion, and this is why we want to share our passion with our buyers,” says Soon Kian Cheong, director at Rivertree Group. To Rivertree, it is evident that what a developer needs to have is foresight, to believe in a project before the fruits of its labour are even materialized. With past project Sutera Pines in Sungai Long, Rivertree was labelled by the Cheras local folks as a fly by night developer, as they did not know much about the developer. When first launched in February 2015, the company sold 40% within six months, attaining the attention of developers in Cheras, not just the buyers. “We saw potential in building an apartment/condominium scheme next JANUARY 2017 I 29


to Twin Palms, Sungai Long few did as the location was perceived as far from the existing old Sungai Long and Cheras townships. Today Sutera Pines is no longer at the edge of the old Cheras township with Eco Majestic and Setia Eco Hill townships being already developed and just a mere 11 minutes away via the new highways. We are good at spotting ‘uncut diamonds’,” Dato’ Simon adds with a bright smile. BUKIT RAJA : KEY TO ILLUSTRIOUS HEIGHTS Rivertree decided on setting its industrious eyes on the affluent township of Bukit Raja, based on many compounding and resounding reasons. With the attainment of two pieces of prime commercial land banks in the area (turned into phase 1 and phase 2 of the development), the developers knew that the location complied well with their long-term goals of setting up a signature development in a mature neighbourhood, and to offer its potential buyers with not just its purchasing elements, but also with establishing a healthy green living concept for its buyers. Surrounded by five major developers – Sime Darby Bandar Baru Bukit Raja, SP Setia’s Setia Eco Park and Setia Alam, Eco World, PKNS and Titijaya, it is evident that Bandar Baru Bukit Raja’s status as a township of Bukit Raja and Setia Alam, accessibility to the area is apparent with the New Klang Valley Expressway (NKVE) and the West Coast Expressway (WCE) 30 | JANUARY 2017

linking the area, and providing easy access to the port and township. With proximity to apartments and surrounded by SME factories, Rivertree’s Bukit Raja Signature Lifestyle shop offices will not only attract townsfolk from the surrounding area, but also from various spots within the Klang Valley as well. “In the earlier days, if you were from Damansara Utama or SS2 you would seek to purchase properties in Puchong based on affordability and standard of living. It has become apparent for a while now that the next stop away is Setia Alam, using the NKVE being only approximately 10 minutes away without any traffic jams,” Dato’ Simon reiterates further, illuminating the fertility of Setia Alam, Setia Eco Park and Bandar Baru Bukit Raja which already have an existing estimated population of about 150,000 people. With five major developers circling its backyard and surrounded by two major townships, Rivertree strives to pursue the extra mile, ensuring that its products are of incontestable value, unique design and excellent quality. As a unique niche boutique developer, it is very important to Rivertree that its buyers and investors enjoy every value of their hard-earned money, and invest in properties that stand the test of time, and appreciate strongly within the market. For example, it only develops shop office commercial developments for both phase 1 and 2, as

they believe that the location undoubtedly compliments the upcoming abundant approximately 1,200 apartment units right next to its developing site developed by Sime Darby which would easily add another 6,000 people to the existing highly populated area. The building of modern column-free facades and curtain wall glass frontages allow Rivertree to be unique in a constantly shifting industry, keeping its visual attributes convenient and up to date with modern design ideas. This concept was a success in the recent 100% sold out 20 Rivertree @ Serdang development which was completed in March 2016. The development were closed to 80% rented out and booked when the CCC/CF was issued. With Rivertree encompassing talents from multidisciplinary backgrounds including but not limited to medical expertise via Dato Simon’s collaboration with Dato Dr Colin Lee, who is a world renowned IVF specialist, the Group would not only bring a new breeze to the development industry but it will also elevate Malaysia’s status in health related developments in the whole of Asia. Rivertree is ready to put buyers in awe with its upcoming first of its kind development in the heart of the city. CONFIDENCE IN SALE UPTAKES With two bustling and mature townships surrounding the development, and with developers vying to develop the area,


Property is our passion, and this is why we want to share our passion with our buyers.” -Dato’ Simon David Leong Rivertree are confident in the positive sale uptake of its project at Bukit Raja. Current shop occupancy rates within the surrounding area are at an optimistic 95%, supporting the foresight that dwellers in the surrounding towns will spur demands for commercial shops. “Commercial properties generally command higher appreciation value and yield higher rental returns, whereupon one may consider investing for purposes of own wealth preservation” Mr. KC Soon affirms. However, It is also crucial for operators to note and be aware that bank loans have not differed much from what it used to be 20 years ago. “The late 90’s saw SME’s receiving 100% back-ups from banks, with term loans at 70-80%, and 30% tradelines. Today, we’re back to where we were back then, and its crucial for operators to note this” Mr. Soon adds. A BRIGHT AND RESONATING FUTURE Dato’ Simon and the team at Rivertree Group want to leave a good legacy behind. All partners at the company are in the process of setting up foundations and charities to benefit their own specific passions, with a keen desire to give back to society, not just through properties. For Rivertree Group, the wheels have been set in motion. Future plans include developments with medically supported, incorporating healthy living. Intergenerational development is the way forward, with projects that cater to keeping a few generations under one roof. “We aim to build condominiums with single surviving parents living on the ground floors with accompanying nursing systems, and their descendants living directly above them,” Dato’ Simon adds. The sky certainly is the limit, for this rare and one of a kind developer. JANUARY 2017 I 31


BUYING SMART IS MADE UP OF COMMON SENSE THAN IT IS OF GENIUS Buying below the market rate is not classified as buying an undervalued property BY: FELICIA SOON

32 I JANUARY 2017


n increase in cost of living, weakening Ringgit, the current economic and political climate and stringent bank regulations have caused property buyers and investors to adopt a wait-and-see stance now, and will be delaying their decision to purchase till the second half of 2017. Rentals are also affected and the demand for high-end luxury property is currently decreasing as property buyers are now opting to purchase something more affordable to meet their monthly mortgage payments. Given this situation and to attract prospective buyers, many property owners who are willing to sell their units or houses lower than the market value. This trend was widely seen in 2016. Although some property experts have claimed that buying an undervalued property is not a good purchase as to them it means buying below the market rate, MIEA President, Siva Shanker begs to differ. According to Siva, buying a property below the market rate does not mean that the property is undervalued. “Firstly I would like to know what is the definition of an undervalued property, before we look into the pros and cons of it,” says Siva. “Of course buying an undervalued property could mean that for the same amount of money, we can buy a bigger and better place. Emotions aside, we should consider buying a property that is closer to our working place, as I do not see the point in buying a place far away simply because we wanted a much bigger place.” he says. Dexter Lim, co-author of the best-selling book in Malaysia, “Start from 0!” with W.T Kam, took only three years to build a RM10 million property portfolio and has this to shareW “I have bought properties below the market value in my investment journey so far. To me, it is like buying products at wholesale prices rather than at retail prices, and in my humble opinion, it is totally fine to buy properties below the market value but it has to be backed up with solid reasons as to why this property should even be considered. Don’t just buy any properties below the market deals that come your way, as most are usually lemons i.e. in very bad or dead locations, quiet and too isolated.” he affirmed. Dexter added, “During economic

We should let others who know how to locate good deals to continue buying them without interruption from new players .’’ - Dexter Lim

downturns, it will affect everyone across the board. Capital appreciation for properties would also be affected whether it is undervalued or otherwise. But when it rebounds, the same property can sell at similar prices as those purchased previously at par market prices. Hence the profit would even be more attractive.” Yet again, there are many who could afford to buy but are still not buying. The reason- they are still waiting for an undervalued property in an area where the demand far exceeds the supply! Why not venture outside the box? Khalil Adis, founder of Khalil Adis Consultancy believes that undervalued properties are a good buy because there are some inherent risks to it. “The downside is that you must do proper due diligence to ensure the property ownership is legally transferred to you. Also, you must be prepared to have extra cash on hand to pay for outstanding utility

bills, conservancy charges and so on. And, there have been cases where it is almost impossible to evict the owner after the property has been purchased.” In conclusion, buying properties which others have not yet discovered yet is not necessarily a wise decision, and we should also not confine ourselves to the usual choices of the majority such as buying properties only within hotspot areas. Although older properties that are in need of a make-over may be seen as undervalued when compared to a modern looking new property, the ‘make-over’ is going to be much lower than having to buy a totally new place and yet still spending thousands to renovate it! So if you so happen to know how to locate a good deal at below market value, then consider the fact that sometimes buying such properties can actually be a better choice. After all, who can say ‘No’ to a good offer nowadays. JANUARY 2017 I 33

Slowdown in the economy - Oil price - Weak commodity price - Rising cost of living


Depreciating Malaysian Ringgit

Declining volume of property transaction

Slowdown of construction activity in the residential sector


Devaluation of Chinese currency (YUAN)

President-elect Trump's ecoNOMIC policies-back pedal?

Malaysia’s property market to remain FLAT

Further decline in the property transaction activity



SOARING IN THE HEART OF KUALA LUMPUR Bustling with a never-ending lease on life BY: DIVYA PREMBAJ

36 | JANUARY 2017


ituated in the densely-populated heart of Kuala Lumpur, the federal constituency and township of Seputeh lies nestled comfortably within the midst of a lush green landscape and a fast-paced community. Interconnected conveniently to the hotspot areas of Kuala Lumpur, through various modes of accessibilities and transportation, the township is a mature one and will nonetheless keep driving its population to maintain their property investments within the area. The following areas represent the vicinities that encompass the township of Seputeh, as it is sub-divided into many smaller districts:Kampong Penghulu Mat

Taman Seputeh

Taman Desa

Salak Selatan

Taman Sungai Besi

Salak Tempatan Dalam

Salak Tempatan Changkat

Salak Tempatan Bukit


Taman United

Taman Happy Utara

Taman Happy Tengah

Taman Happy Selatan

Kuchai Entrepreneurs Park

Taman Salak South Utara

Taman Salak South

Taman Sri Petaling Timur

Taman Sri Petaling

Bandar Sri Petaling

Taman Overseas Union Utara

Taman Overseas Union Selatan

Taman Yarl

PPR Muhibbah

Located strategically right next to the affluent township of Bangsar, Seputeh was developed into its first housing community with Taman Seputeh in the 1970’s, inherently booming the property industry within the area as its strategic location promised, and surrounding business districts continued to develop. The town consists of real estate ranging from condominiums, apartments, terrace housing and other landed properties. In 1978, 2-storey terrace houses in Taman Seputeh were slightly higher in prices than those in the Bangsar housing estates. James Wong, managing director of VPC Alliance (Malaysia) Sdn Bhd affirms the property landscape during Seputeh’s early years of development. “The average price transacted for a 2-storey link house in Taman Seputeh was around RM85,000, whereas a 2-storey link house in Bangsar Baru was only around RM78,000. However, today, 2-storey link houses in Bangsar

Baru were transacted between RM1.5 million and RM2 million as compared to 2-storey link houses in Taman Seputeh which were transacted between RM1.25 million and RM1.5 million,” he states. Nevertheless, as the Seputeh residents are able to access the public amenities and commercial developments from the mature neighbouring township, Seputeh housing prices are still stable. Notable developments that have attributed to Seputeh’s rise in the residential market include the conception of Mutiara Seputeh by Hunza Properties in 2009, set on 15 acres on Bukit Seputeh. Consisting of 80 3-storey semi-detached units, and a dozen 3-storey bungalows, the development boasted a protected enclave that serves a quiet, tranquil neighbourhood tucked away from high rises, heavy traffic, and pollution. The piece of land that Mutiara Seputeh is situated upon, is precious as one of the last pieces of freehold land within the city

centre area, as the development was built on elevated land, with only six units per acre. Apart from that, another prominent residential development in Seputeh that elevated its status as a residential township, is the exclusive and unique Sierra Seputeh - a gated community with 54 semidetached units and four bungalows on Bukit Robson, in Taman Persiaran Desa. These affluent units have helped increase Seputeh’s name as a modern township. Based on market observation, there are currently only about 5% - 8% of commercial developments in Seputeh and the majority are residential units. The commercial developments include furniture sales gallery shops, Wisma YPR, My Hotel Premier, 3 old budget hotels, Petron petrol stations and a row of 3-storey shop offices along Jalan Bukit Raja, off Jalan Syed Putra. All shop offices are fully occupied.



Floor Area (sq. ft.)

Consideration (RM)

Price Psf (RM psf)

Robson Height





Bukit Robson





Robson Condominium





Kristal Court





Sri Langit Condominium





Seputih Permai Condominium





Menara Seputih





Source: Jabatan Perkhidmatan dan Penilaian Harta (JPPH) / Valuation and Property Services Department JANUARY 2017 I 37

AREA FOCUS B. Terrace houses in Seputeh Tenure


Land Area (Sq. ft.)

Built-up Area (sq. ft.)

Consideration (RM)

Price Psf (RM psf)

Taman Seputeh (JalanW 1/87C)







Taman Seputeh (Jalan Taman Seputeh)







Bukit Seputeh







Desa Seputeh








Source: Jabatan Perkhidmatan dan Penilaian Harta (JPPH) / Valuation and Property Services Department *Note: Price per land area

C. Semi-Detached houses and Detached Houses in Seputeh Tenure


Land Area (Sq. ft.)

Built-up Area (sq. ft.)

Consideration (RM)

Price Psf (RM psf)

Mutiara Seputeh (overview golf course)


3-storey Semi Detached House





Vasana 25


3-storey Semi Detached House





Taman Sierra Seputeh


2½-storey Semi Detached House





Seputeh Heights


Bungalow Vacant Land




Vasana 25


3-storey Detached House





Seputeh Point


2½-storey Detached House






Source: Jabatan Perkhidmatan dan Penilaian Harta (JPPH) / Valuation and Property Services Department

EASY ACCESS The inherent rise of Seputeh as a residential commercial area is due to a multitude of reasons that would contribute to its appeal for real estate migrants, property investors and first time home buyers to stake their claim within the area. Due to its central city location, the township is easily accessible via several major highways, notably:1. Federal Highway 2. New Pantai Expressway (NPE) 3. East – West Link Expressway Further linked by the Seputeh Komuter train station that is located right smack in the middle of Seputeh and along the KTM Komuter’s Batu Caves-Seremban line, the township is easily linked with outstation towns, bringing in further traffic from these 38 | JANUARY 2017

outlying areas. Apart for that, the light rail transit (LRT) stations of Masjid Jamek and KL Sentral are situated within a short distance from Seputeh, further cementing the town’s interconnectivity within its neighbouring communities. PLACES OF WORSHIP The decision to place a residential investment within a chosen area also lie with the places of worship that the area possesses. Tien Ho Temple (Taman Persiaran Desa) and Sri Shamundeswari Temple (Desa Seputeh) are examples of two places of worship, catering to the Chinese and Indian dwellers and communities that reside within Seputeh’s many districts. In addition, there are a few mosques besides the famous Masjid Jamek that are situated

within the vicinity as well, catering to Seputeh’s Muslim community. SHOPPING AND COMMERCIAL HAVEN Seputeh is also undeniably fortunate to be located in the heart of Kuala Lumpur, as the cosmopolitan city boasts many entertainment and shopping versatilities, being a solid hub of modernization within the Klang Valley. Situated just minutes away from Kuala Lumpur’s major shopping destination - Mid-Valley Megamall, the township is able to attract not only locals but expats as well, with the area being a viable tourist hotspot. With the city churning out jobs and various opportunities, it is no wonder that the area has been maximized with its property development ideals.

Image Courtesy : JANUARY 2017 I 39


Image Courtesy :

Image Courtesy :

TOP FOODIE JOINTS IN SEPUTEH 1. Siu Siu Restaurant - Lorong Syed Putra Kiri, Taman Persiaran Desa, Seputeh. -Tucked cozily in a corner, this Chinese seafood restaurant boasts a wide array of delicacies, with signature dishes ranging from its BBQ Char Siew, Pork Knuckle, Salted Egg Yolk and Vietnamese Fish Head Curry 2. Glasshouse at Seputeh - 7, Lorong Syed Putra Kiri, Taman Persiaran Desa, Seputeh. -Nestled comfortably in the surrounding hilltops of Seputeh, Glasshouse is a marvel

Image Courtesy :

of architectural design, that is usually reserved for weddings, banquet, dinners and parties. It’s cool, laid-back and stylish interior gives a feeling of tranquility, amidst an abundance of greenery. A perfect escape from the hustle and bustle of Kuala Lumpur. 3. Kingstreet Cafe - Plaza Perabot Seputeh, Taman Seputeh, Kuala Lumpur - Situated right under the Plaza Perabot Seputeh building, Kingstreet Cafe is a delight to behold. With an extensive western decor, the interior compliments

Image Courtesy :

the dishes served - western delicacies with a slight Asian tinge. Well known for its deserts such as the Toasted Brioche with Pandan ice cream, customers are also treated to a well brewed cup of coffee. 4. Taishu Yakiniku Japanese BBQ - Taman Desa, Seputeh - A legendary haunt in Taman Desa, this quaint Japanese stall caters to everything Japanese your heart desires, with a stellar collection of cold cuts and fresh meat for the Japanese BBQ style it does so well.

UPCOMING/ONGOING NOTABLE COMMERCIAL PROJECTS AND DEVELOPMENTS Two prominent developments that are currently underway in Seputeh include the following :1. 9 Seputeh • Developed by Gapurna Land Sdn Bhd, 9 Seputeh comprises of nine blocks of mixed developments, ranging from a series of serviced apartments, serviced residences, SOHO suites, and commercial centres located in the core of Seputeh. • Residents can expect two floors catered for outdoor and indoor activities, apt carpark provisions, state of the art architectural designs and many more affluent themed additions, to the high end development. • The project is scheduled to be completed in April 2018. 40 | JANUARY 2017


Approximate Price (per Sq. Ft.)

Tenure/Land Title

9 Seputeh

Leasehold/ Residences

Approximate Maintenance Fee (per Sq. Ft.)

Start at RM840

Car Park Bays

RM 0.44

Starts from 1 per unit

2. Setia Sky Seputeh • Developed by S P Setia Bhd Group, Setia Sky Seputeh is an exclusive, low-density condominium development, encompassing 290 units spread across two towers. • The project is due for completion in quarter four of 2020. Project

Tenure/Land Title

Setia Sky Seputeh

Approximate Price (per Sq. Ft.) RM 1,250 (tentative)


Car Park Bays 3-4 per unit (depending on unit type)

Further future developments include:No. 1

Location Lot No. 660, Taman Seputeh, Kuala Lumpur (facing East -West Link Expressway)


Lot 58 & 59, Seputeh Heights


Lot 121, Jalan Taman Seputeh (Setia Sky Seputeh)


Lot 113, 156 and 116, Seputeh Heights

Type of Development


3 blocks of 46 and 51-storey serviced apartment with total of 872 residential units

Planning Submission

36 units of 3½ - storey terrace villa (stratified)

DO approved

2 blocks of 37-storey condominium (290 units)

Launched in September 2016

31 units of 3½ - storey terrace villa

DO Approved

Note: DO – development order

The following are a composite of reasons as to why Seputeh makes a good area for property investment:• Easy access to public amenities and commercial developments from mature neighbouring localities such as Bangsar, Mid Valley, Brickfields, Kerinchi, KL Sentral, and KL Eco City. • Close proximity to Kuala Lumpur City Centre, only about 5 kilometres away and to popular commercial

• •

developments such as Mid Valley Mega Mall, The Gardens Mid Valley, Bangsar Village, Pantai Hospital, Menara UOA Bangsar, Menara Dataran Maybank, Nu Sentral.. No low cost or medium cost housing developments in Sepute. Easily accessible via several major highways such as Federal Highway, New Pantai Expressway and East West Link Expressway.

Seputeh is located next to Bandar Malaysia (Ex-Royal Malaysian Airbase). When the Bandar Malaysia is developed with High Speed Railway (HSR) from Malaysia to Singapore and completion of other mixed developments, Seputeh house prices will appreciate and will receive good rental yield.

AGENTS SPEAK JAMES WONG, managing director of VPC Alliance (Malaysia) Sdn Bhd

CELINE LEE, senior real estate negotiator

“We expect to see minimal changes in

“We see positive growth within the Seputeh

Seputeh within the next five years, as there

area, especially with the completion of Eco

is a scarce amount of large pockets of land


for Prosper Realty

left in Seputeh for development. However, there will be about 1,200 upcoming residential units within the next 5 years, catering to the community at Seputeh.” JANUARY 2017 I 41



The young entrepreneur, businesswoman and media mogul shares her views on life and a stellar career in the limelight BY: DIVYA PREMBAJ

42 I JANUARY 2017



er face can be found gracing the covers of flashy magazines, with a smile so bright and inviting it catches your attention almost immediately. She is no stranger to Malaysian television screens, her films, series and commercials plastered on local and international media. Nur Fazura Sharifuddin is certainly a household name, renowned and heard often on the lips of many a Malaysian as simply ‘Fazura’. One’s first impression of her would be that she was soft spoken, with a delicate and timid nature surrounding her personality and stature. However, this is a classic example of judging a book by its cover. She is all of these traits, and so much more. HUMBLE BEGINNINGS Born in the rural district of Pekan in Pahang, Fazura is the third of four siblings, the only daughter among three protective brothers. Even from an extremely early age onwards, Fazura knew that she wanted to be in the media industry. Growing up in a small town, her origins have played a vital role in the person that she is today, molding the personality that we have come to know and love. Passion has, and always will be, a driving force for Fazura. Like many celebrities, the acting bug caught her unexpectedly in her 19th year, when she was approached by an agent in a shopping mall. The young ingénue was eventually casted in her television debut by shampoo brand Pantene, as the model for one of its television advertisements. “From then on I received many numerous offers to be in films, but I was more interested in doing commercials, and eventually I accepted my first film role in 2004 for Bicara Hati, and the rest is history,” she reminisces with a contented smile. Bicara Hati earned Fazura her first award in the film industry – Most Promising Actress in the 17th Malaysian Film Festival. The award affirmed her skills in the industry, with an acknowledgement of her talents providing her a zest to carry on with her passion. However, it was 2005’s Gol & Gincu that truly affirmed her status in the Malaysian film industry, with the film

bagging the Best Film Award at the 19th Malaysian Film Festival, and receiving rave reviews and publicity. Following her success within the Malaysian film industry, the young starlet moved on to television series culminating with her own miniseries, Facing Up to Fazura in 2014 on the international cable channel E!. More endorsements along with hosting and emceeing gigs propelled her further, cementing her name within her industry. HOUSE OF DOLL It is no known secret to Fazura’s friends, family and beloved fans that she has a keen innate sense of fashion. Prior to emerging into the celluloid industry, her passions lay strongly within the fashion industry, however chance circumstances would see fit that her first foray would be in the film industry. After further establishing herself into the Malaysian film and television landscape, Fazura decided to branch out and diversify her name and brand, and plunged headfirst into setting up her first business, a fashion boutique in the heart of the Klang Valley. House of Doll materialized in 2012, providing a platform for young Malaysian women to emulate her style sense, especially her fans. “I have always loved fashion, and have always dreamt of sharing my style sense by dressing women up with my own knowledge and love of fashion”, she shares exuberantly. Her eyes always light up when she talks fashion, as her passion shines clearly and effortlessly through them. Mixing property investment and fashion With the conception of House of Doll, Fazura found herself facing a brand new type of challenge. “I had worked hard on film after film, with the money earned going into setting up House of Doll. It was certainly a trial and error case, upon which I did lose money during the early days,” she says with a hint of rumination. The first thing that went into consideration upon setting up House of Doll, was inherently finding the best location to establish the business. It was imperative that it would have to be in a high trafficked area, accessible and easily found for her JANUARY 2017 I 43


- The finances do not stop at the acquisition of the property, consider and analyse the future expenditures that come with renovation and upkeep of the property. 3) Take your time, never ever rush your decisions. - Avoid listening entirely to third person opinions, use these inputs as supporting factors in your decision-making process. UPWARDS TRAJECTORY Life is only moving upwards from here on, for Fazura. She is a powerhouse, with her film credentials rising higher each year with awards, along with her fashion boutique and celebrity endorsement campaigns. Apart from that, she also dabbles in the Malaysian music industry with the release of her first single, Sayangi Dirimu, in 2014. Collaborating with well-known Malaysian rockers Estranged later on, landed her with a new single in 2016, Hancur Aku. 2017 will be an exciting year for Fazura, and all eyes undoubtedly will be fixed on the young entrepreneur’s moves with her upcoming developments in all her industries. The future is indeed looking ‘Fazbulous’ for Fazura.

customers and clients. Fazura found that location, in the bustling township of Bangsar. “I spotted a place in Bangsar that fitted my needs to set up House of Doll, and renovated it with my own money without any loans”. Recovering the money back was the true challenge, as with many first-time business investors. It was crucial for Fazura to invest in a property that would continue to appreciate, and the location of House of Doll in the middle of the hustle and bustle of Bangsar 44 I JANUARY 2017

served this purpose perfectly. From her own experience, Fazura shares a few tips on how to invest with the right mindset: 1) Conduct your research extensively - With the right amount of financial capacity and means to start investing, it is important to always conduct a thorough research first. Never jump to conclusions, and always listen to your inner voice. 2) Think of the money you’re going to spend

FAZURA’S LIFE MOTTOS - Never be completely out there at all times. It’s good to maintain an air of mystery, and to not be in everyone’s face constantly. - Follow your heart and intuition (stay classy and make sure you are in the limelight for good reasons, not notorious ones) - strong goals, line them up with your passion. Never give up on your dreams. - Work hard and always be a good team player. - Stop being affected by what people say, especially negativity. Use them as a motivation to push on harder with your dreams. - Constantly think of ways to improve yourself, never settle for mediocre.

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TRENDING MARKET STRATEGIES Online and Digital Platforms Surging Markets into the Future BY: MAGES PV LINGAM


orward thinking entrepreneurs are perpetuated on a working process or model to lift their business acumen to another level altogether, with minimal usage of resources. Executive director of Brand 360 Degree Sdn Bhd, Julia Koh, said that for every situation there will be opportunities trending and it is up to the companies to take advantage of the market. As for branding, the technology explosion is very inevitable, that is the power of video marketing. This trend has gained speedy momentum to capture the mass market. Nevertheless, the brand essence should be

46 I JANUARY 2017

present in the video to be comprehensive to deliver the messages. It can be an online video or a series of videos but it should benefit the end users. As for the duration, Julia commented that it will primarily be depending on the channels or medium utilised for the purpose such as Instagram, Facebook or WhatsApp. WHAT’S IN STORE? Meor Addelan, managing director of Q. Medien, gave his view that the emerging marketing trend is via content video marketing, which has a faster digital time

capture. When the relevant people in the industry know of your brand’s existence, the elements used such as pictures, statements, surveys and blog videos would be able to gain people’s attention within a shorter span of time. It can be an 8-second video, but if the message that touched the viewer is especially relating to sentimental aesthetics, then the message is guaranteed to be delivered and well received. Partnership lead of Google Malaysia, Lim Huey Ching, added “YouTube videos will be the next big thing in 2017. This year, the growth of viewers has gone through the roof


YouTube videos will be the next big thing in 2017. This year the growth of viewers has gone through the roof compared to last year,” - Lim Huey Ching compared to last year”. The basic sights, sounds and motion are the contributing elements and even a 5-second interval video cannot be skipped by the viewer. But if the content is eye-catching, then they will choose to consume the information for a full 30-second slot. VIDEOS IN TREND Millennials are more prone and exposed to video trends, and they enjoy indulging themselves by taking advantage of the ideas grown within that space. The business community should consider the potential that is steadily rising from this growing network. “A split 3-second is sufficient when all you need is to focus on fundamentals instead, as the trend varies. Devices like mobile or smart phones will significantly increase in usages,” said Andreas Vogiatzakis, chief executive officer of Havas Media Group. People who are captured by the content are willing to watch a full video if it has added value. This viral trend can either make or break the cycle within this sort of video content. The synchronisation with the platform is far more vital than the execution at a later stage. For example, Netflix and Iflix have been blown out of proportion for being successful content based strategists, in capturing the online streaming video on demand market simply because of digital entertainment catalyst - which is fast, efficient and target oriented. DIGITALISE IT It is a common understanding that people prefer affordable and cheaper things in life. Therefore, they need to come out

with alternative ways that requires less expenditures, or at a minimal cost. There are free multi-channels that can be used for this purpose such as LinkedIn, You Tube, Instagram and so on. However, being inactive online, coupled with the inconsistency in content can also deter from achieving the motives of brand awareness. Popular online streaming video creators like You Tube are always looking for upward trends to get more people to subscribe or watch their channels and make more money. A simple video-log can be between 5-10 minutes long but by changing its strategy and telling a story via the video, consistently might give an impact too. Julia affirmed that knowing your target audience and understanding that you can deliver consistently the tailor-made messages through your preferred channels are important. The message should be readable and understandable, because if the message is not mobile friendly or understood it beats the whole purpose. As for Andreas, he asserts that focusing on strategy to make a video viral is secondary compared to delivering the accurate messages for the masses. Your online strategy should be the evangelist to propagate the brand. Add value to your target audiences, and believe in your product or services; be it entertainment or informatively driven. Meor affirmed that strategies need to be worked out from ground level via online networking, billboard marketing and more, but it is wise to understand your target audience first. Internet penetration has gone over 70 percent via mobile marketing,

therefore it is imperative to understand how to use the medium, and how to grow by using online media. TARGET PLEASER On the query of below and above the line marketing, it starts with the product, target audience, values and needs that need to be fulfilled. The conventional way is still the crowd pleaser, via email marketing. The most effective social media of email marketing works miracles when you craft viable communication messages but with minimal budget. Lim added “With online it is easier to track. I believe in trial and testing. You can determine the method to use to drive the sales target. It would be also conducive to allocate a certain budget to channels that work best for your target audiences,” “My idea is not to draw any line and limit your chances. In the end, it would be best to test the market and know where you would want to sell your products or services,” shared Meor. Julia said it is all in how comfortable you are in dealing or delivering your messages to fit your target audiences, and getting connected to meet their needs. One tested strategy is giving back to the community through incorporating corporate social responsibilities (CSR) values. It is also imperative for entrepreneurs to understand their clients, as there is nothing more satisfying that giving values to the them as a loyal and long lasting brand. Technically, it pays to add value to anything which caters to the stakeholders and companies that reaps the satisfaction from the strategies. JANUARY 2017 I 47



Kit believes a good research will yield better investment returns BY: FELICIA SOON

48 I JANUARY 2017



all and petite, Smart Financing’s CEO Kit WL hails from a scientific background prior to meeting her business partner, Gary Chua, who introduced her to the banking industry. “I was very fortunate to have met Gary and venturing into the banking industry, because it totally changed my property portfolio as now I am a full-time property investor,” says Kit with a bright smile. Kit worked as a product manager in a bank for a few years before she started investing in 2009. “I wanted to get out of the rat race. A rat race meant that you have to work from 9am-5pm where you trade your time for money and I wanted to change the situation where I no longer needed to trade my time for money, rather I could do something which I am passionate about.” For her, property is considered a low risk investment because it is tangible, as in you can physically see it when compared to other investment tools. “I did try before with stocks for one whole year. It was more of a trial and error situation because I was not good in it. My net gain for that whole year was no gain, no lost. I felt apprehensive that I wasted time in playing stocks as I didn’t see the effectiveness in it. I was still working at that time and wanted to know more about business, for example finding out how to calculate ROI - something that I did learn,” Kit adds. Kit had also added a Master’s in Business Administration to her portfolio, to develop her knowledge further in business. “Just imagine when you go out into the working world and people ask you whether you know what ROI is, and you look at them with a blank face and say ‘what do you mean by ROI?,” jokes Kit. “Hence, I experienced a steep learning curve when I did my masters because I learnt all the business terms which proved to be very rewarding for me. I had also discovered that my passion has always been towards property,” says Kit. During her reign in the banking industry, Kit picked up more on how the finance industry works. “How I manage my finances, how the bank sees the elements, and virtually anything within the industry,” adds Kit. As far as first investments go, Kit started in 2009 with a high-rise residence in Cheras that was meant to be a bachelorette’s home. “That time I had just came out from university to work. Most of my friends were

starting to buy cars. But for me, I was quite fortunate that I did not need to buy a car because I got a car passed down to me from my siblings as I am the youngest in the family,” says Kit, chuckling. “I thought, what should I do with the money that I have? It was then that my mum suggested that I buy a house and the idea appealed to me because I only had to pay a thousand dollars from my current pay for the loan, and since I did not have a car loan, I found it affordable to purchase the high-rise residence in Cheras,” adds Kit with a smile. To Kit, this investment was also like another trial and error because many people were questioning her decision on buying that property.

“First of all, it was not a landed property. However, it was priced at about 200 thousand dollars, and on top of that, my mum helped me to choose a unit that came with a view of the KLCC towers with each window costing an extra 10 thousand dollars. So I had to pay an extra RM30,000, compared to other units there,” explains Kit. She was also asked on why she preferred to buy a 950-square foot high rise rather than a landed property because back then in Cheras, there were a lot of landed, single storied homes and they were also around RM200.000, so it was rather surprising for most people that she chose to buy a smaller unit for the same price. “I gave a lame reason, JANUARY 2017 I 49

INVESTOR NEXT DOOR affirming that if anything happened, I could stay by myself and near to my parents,” laughs Kit. Today, Kit says she has no regrets in buying that property as when the property was completed in 2012, the value went up exponentially. The present asking price for the high-rise residence is sitting comfortably at RM400,000 to RM500,000 which was double the price she paid for. It currently resides right in front of the MRT Line 1 that was developed in the later years, and within walking distance from Cheras Sentral Shopping Mall. While landed properties have a stronger potential for capital appreciation, they tend to come with negative cash flows due to the more expensive purchase price relative to the rental they fetch. Hence, investors should apply the “Concept of Pairing” which involves pairing negative cash flow landed properties with condominiums that generate positive cash flows. This will lead to a neutral cash flow. A positive cash flow is where rental exceeds the monthly housing loan instalment, while neutral cash flow properties are those where rentals equal about the same as the monthly repayment. Property prices have averaged (an increase of) about 5.6% per year from 1999 to 2015. However from 2010 to 2014, which were years of relatively easy credit – house prices increased a fair bit to 11.5% per year. Last year and this year, house prices have normalized to the 5.5% range. As of now Kit has two properties on hand, having bought the second property, a serviced residence at Cyberjaya in 2011. It is beside MMU University, and comes with a Guaranteed Rental Return (GRR) of 8%, making it easier to find a tenant. However, the drawback is that the appreciation value is not there. “Right until now, people are still asking me to sell it at RM400,000, which is the same as the original price I bought it for,” says Kit. When asked on whether the location played an important role in the capital appreciation of properties, Kit shared that 30 years ago, a landed property in Bangsar was around RM30,000 and today it is worth RM1.4 million. There are older apartments in Cheras, Old Klang Road, OUG and Taman Desa (in Kuala Lumpur) that offer investment opportunities and decent cash flow 50 I JANUARY 2017

prospects as well. Throughout her investment journey, Kit sticks by strongly with the knowledge that research and information analysis are crucial before one ventures into buying properties, as it is pivotal that this will help to determine and identify the overall property value. Property is one of the most popular tools for wealth accumulation. But investors need to acquire the key skills needed first for property investments which includes forming your own investment philosophy, selecting target areas, negotiating, taking care of cash flow and net worth and managing tenants and stakeholders. Investors should narrow their target areas to not more than 30 minutes’ drive from where they live. This will help to minimise the time and effort required to manage the property and tenant. Look online and pay attention to ‘For Sale’ signboards in your target areas, especially when they have been put up for a long time. Call up agents in your target areas and tell them what you want, for example cash flow positive properties within your budget of RM200,000 – RM300,000.



Property type

Serviced Residences

Purchase value (2009)


Market value (2016) RM450,000 Price psf


Rental per month


Rental yield


Loan margin


Loan tenure


PROPERTY 2 Location


Property type

Serviced Residences

Purchase value (2011)


Market value (2016)


Price psf


Rental per month


Rental yield


Loan margin


Loan tenure

40 years





016 321 9033 / 017 779 1688

NO. Lesen Pemajuan Perumahan: 14153-1/11/2017/ (0934(L) | No Permit Iklan dan Jualan: 14153-1/11/2017/0984(P) | Tempoh Sah: 05/11/2015-04/11/2017 | Tarikh Dijangka Siap: Mei 2019 | Hak Milik Tanah: Pegangan Bebas | Gadaian Tanah: Tiada | Pelan Bangunan Diluluskan Oleh: Majlis Perbandaran Sepang | No. Rujukan Pelan Bangunan: MP Sepang 600-34/2/71(12) | Jumlah Unit dan Harga: Pangsapuri (1,168 Unit) MIN: RM395,460.00 MAKS: RM958,247.00



City dwellers are now seeking affordable homes in the suburbs BY: FELICIA SOON

52 | JANUARY 2017


ccording to a survey by the Real Estate and Housing Developers’ Association (REHDA), the number of unsold units at new property launches has increased over the past two years. Stricter lending rules have also attributed to more homebuyers finding it difficult to secure a housing loan. The negative trend in the property sector continues as the third quarter of 2016 registered a decline of 8.45% and 6.34% drop quarter-on-quarter in volume and value respectively, according to National Property Information Centre’s (NAPIC) data for 3Q2016. A total of 76,456 properties were transacted, averaging 25,485 properties a month, with a decrease of 10.98% compared with the same period of 2015. On transacted value, the total dropped from RM32.88 billion in 2Q2016 to RM30.79 billion in 3Q2016. Compared with 2015, the total transacted value has declined 17.91%.

What is important in this current market is that we continue to meet the needs of our customers.” - HC Chan

Residential properties continue to dominate the property sector, where a total of 49,640 residential properties worth RM15.61 billion were sold in 3Q2016. A closer look at the sales revealed an interesting pattern i.e. a number of buyers are acquiring properties far away from the city centre. Developers state that suburban properties are being sold to aspiring homebuyers who cannot afford homes in the city, and property investors looking for rental yield and capital appreciation. According to group managing director of MKH Bhd, Tan Sri Eddy Chen, “Most of those who buy property outside the city are planning to live there. These buyers may already be living close to the development or are upgrading from a smaller home.” This sentiment is shared by Beh Chun Chong, CEO of Paramount Property, who added, “Buyers are attracted to such properties because prices are generally more affordable. Land and development costs outside the city centre are lower. There is potential for capital gains if the development meets the right factors for growth such as location, connectivity, amenities and distinctive lifestyle themes.” Sunway Shopping Malls & Theme Parks chief executive officer H.C. Chan resonates this statement with the opening of Sunway Velocity Mall in Maluri Cheras on 8 December 2016. Chan, who is also the adviser in Malaysia Shopping Malls Association, said existing malls in Cheras, such as AEON Maluri and Cheras Leisure Mall, are still operating successfully after all these years. “AEON Maluri has been there for some

two decades but it has been trading well. But there is a lack of one-million-sq-ft malls and we want to elevate the leisure and retail element for the people in Cheras,” says Chan. Such a movement has inevitably attracted more buyers looking for suburban properties. Lee Kok Wah, director of Low Yat Group adds further, “Suburban properties are also offering a safer and greener lifes yle. Residents of new developments will have access to facilities such as clubhouses, gymnasiums and huge landscaped parks.” There is also a small number of property investors looking for strategic buys. Real estate has long been touted as a store of value as well as an avenue for investment. “Equities and real estate are popular asset classes. As an investment, the latter is a more stable asset compared with equities, which are much more vulnerable to the risk of capital flight. It takes some time for an investor to realize capital gains from his property investment, but the risk is lower and it is possible to see capital appreciation as the development matures,” says Lee. These days, homebuyers and investors are better informed and are able to identify locations with good potential for capital appreciation. As an investment, real estate also offers rental yield. “Investors will buy property outside the city if there is potential for rental yield in addition to capital gains. Take properties in Cyberjaya as an example. There is an opportunity to earn rental income from a large student population and a large number of professional knowledge workers in that area,” says Beh. JANUARY 2017 I 53




Here are the top five mistakes made by real estate investors collected from professionals involved in real estate investment BY: FELICIA SOON


re you one of those “single-minded” investors? Real estate investment is considered a liquidity investment but it is also equally risk bound especially when one is not well versed with the trends and nuances of the real estate market. Hence if you are contemplating on investing in real estate, Ong KL and KC Lau, both whom are real estate investors, advise that you should know where you are putting your money into and find out on why other real estate investors fail to help you from making the same mistakes and ensure good return on investment. Read on to know the top mistakes made

54 I JANUARY 2017

and learn to avoid them at all cost. After all, as shared by Andrew Tan, Venture Capitalist and Founder of Luxury Boutique Accommodation, “An investor doesn’t need millions to invest but a positive mind set, an eye for detail, a degree of financial acumen and the determination to succeed.” 1. EDUCATION New investors tend to make the mistake of buying a house first without any proper knowledge. Andrew shares a comment where in response to an inquiry made in a real estate discussion group, someone answered on why can’t they just use

their money as a down payment and learn as they go. According to Andrew, this is probably the worst advice you could ever give a beginner. While money deals may be easy to find, you won’t know what a good deal is without having first invested in your education! This is because the more knowledge you have on investing techniques, financing, acquisition, negotiating and, of course, your local marketplace, the less risky your investments will be. 2. DEVELOPER IS THE KEY Andrew advises that we should be mindful

As shared by Andrew, while there are people who make good money with flipping (buying and then selling for a profit), this is for the short term only. When you sell your property for a profit, you get big money immediately, but it only happens one time for that unit. A more stable strategy for the long term is building cash flow. That means you should buy more properties and rent them out to pay for themselves through monthly rental income. While you will only be able to make small profits with this at first, you can use other previous properties that have you bought as collaterals for taking out more loans to buy more properties, which will in turn generate more cash flow for you. Do this right and your investments will have a snowball effect.

when buying properties for investment. For example, when you buy a condo unit in the pre-selling phase, meaning while the building is still being constructed, you need to see to it that your developer can deliver your unit within the given time frame. While there are many developers in Malaysia with good track records in hitting their deadlines, there are also a lot of them who have been blacklisted. Aside from delivering on time, make sure to check the developer’s previous quality of work for other completed projects as nobody wants a condo unit with leaking sewage pipes from the floors above, or to see cracks everywhere on your walls soon after they get their unit. 3. REAL ESTATE IS A LONG TERM INVESTMENT Real estate is a serious business and things like this require long term commitments.

4. DO YOUR RESEARCH It’s important to research first before you sign anything when it comes to real estate investment. While you may think that the price you are paying seems reasonable because other developments in the same area are been sold for similar prices, you are being stitched like many others. In investing it’s often called “the more fools theory”, states Andrew. Just because lots of properties in a new development are being sold, it doesn’t mean the buyers are smart. Also don’t think that you made the right purchase because the company is big or well-known because at present, there is an oversupply demand, making it even more crucial to look for those which are value for money, and not just focus on location. 5. CASH FLOW A huge mistake investors make is trying to buy a property without enough money. Cashflow management is an important criteria especially on times when everything is uncertain. As emphasized by Andrew, it is risky to buy a property with little or no money down. Catastrophic risks are huge: The local economy changes. The point is, there are innumerable things outside of your control that could happen to your property. On the other hand, rent rates are usually stagnant and it’s rare for you to see a large increase in any given year. However, once you find yourself relying on future price increases to justify an investment, you cease being an investor and become a speculator.

Dr. Ong KL

KC Lau

If you think it is easy to make money on real estate investment, think again!’’ - KC Lau

Ong KL and KC Lau concludes that new investors should start their first real estate investment in apartments as there will always be a demand for residential housing whether the market is going up or down. Besides that, apartments have become a much-needed form of housing because of their convenience, easy-maintenance, security and amenities. It is also cheaper to rent and cheaper to buy. Leverage makes investing in real estate, especially apartment, extremely affordable. JANUARY 2017 I 55




arket sentiments especially in properties have touched the shores of nations in the world, predominantly in areas of investments, be it in residential property or commercial in industrial sectors. National Property Information Centre (NAPIC) have quoted that transacted value have due diligently 56 I JANUARY 2017

dropped from RM32.88bil in the second quarter of the year to RM30.79bil now. The property market has declined year after year with 13.91% (2016) and 12% (2015) respectively due to concurrent factors like global foreign exchange values, the destabilisation of oil and gas industry, and political imbalances all around the globe.

Subsequently, there is hope for a steady pick up among investors and first time home buyers due in the next couple of years. Real estate property consultants MCM Homes co-founder Cannis Chan stated that some of the early sentiments here was due to the goods and services tax (GST), which has taken a toll to hold on among seasoned

investors. Though, Cannis affirmed that year 2018-2019 will see the market with a 30% take up rate, adding that it is best to look out for secondary markets, or from the developers’ end. Cannis continued, “the most favoured states for property investments and home purchases still lie within the Klang Valley, Penang and Johor. Although Johor has shown strong growth due to more development of commercial buildings that carries the multi-media super corridor (MSC) status, and major stake holding companies like Coco-cola, Microsoft and BMW Malaysia, indirectly encouraging developers to build homes close by the plants,”. Commercial Real Estate Services (CBRE) research recently mooted that more millennials are staying at home and putting off owning a property or opting for rent with statistics showing 63% are living with their parents, 23% renting and only 3% owning a property in the Asia Pacific regions. It is a phenomenal outcry to beat the challenge by improving the values of properties with an ‘out of the box’ thought. Hence, a joint venture project by IGB Corp Berhad, situated in the heart of Johor called Mid-Valley Southkey Megamall costing RM6bill will be completed soon; a vital point to boost the state economy and buyers market. Cannis said “A huge project on a 36acre land for the Mid Valley in Johor will attract active movements of property investments and increase the values automatically due to the commercial activities surrounding the city,” Property Investor, formerly VP 1, Malaysia Property Incorporated (MPI) David Shieh Chong shared his view on property markets in other states and said,” Best to look at states with good population growth prospects, where there are good jobs and economic activities where people

would likely want to start their families. More importantly, key facts that bring growth needs to be sustainable long term factors,” He also added that alternatively, some hotspots to consider would likely be satellite cities of Greater KL, similar to how PJ was to KL many years ago. David reiterated in areas to increase the value in our current state of market volatility, especially to buyers looking out for out of the city homes, he looks at it on a collective term for a community or developers too. Traditionally, high capital value growths are based on conveniences or communities that are attractive for families to dwell in, such as easy accessibilities and comfortable amenities. “Desa ParkCity, Menjalara in KL for instance is an ideal community structure with reliable security, green parks and activity areas, schools, hospitals, steady infrastructure and communal connectivity. I believe a formula of building a strong social aesthetic and successful living community revolves around these factors,” As for the market outlook in 2017, David said for the first home buyers or upgrades, it still looks promising to purchase on either sub-sale or residential properties. As for sub sale markets, there seemed to be many older properties (from properties just given vacant possession in the last 12 months to those around 5 years old) which are priced lower, similar to categories of new launches. Equally, there are motivated sellers who may be more accommodating in terms of initial down payment with an agreeable condition. Significantly, as for investments, buyers may look forward to infrastructures related to mainstream transportation that has opened avenues as opposed to a speculator looking at a medium time frame of at least 5-7 years, that properties in Greater KL has still a positive long term prospect on the same reasoning. David added “In summary, 2017 is unlikely to be a year of increase in capital values or rental but more about planning the right purchase while you ride a wave.” Consequently, taking it forward will also be for affordable homes to mushroom in property sectors, especially catered for middle and lower income bracket buyers. From the recent Budget 2017, strategy to build 10,000 units of houses in urban areas for rental will increase the mode of

In summary, 2017 is unlikely to be a year of increase in capital values or rental, but more about planning the right purchase while you ride a wave.” - David Shieh

purchase among new buyers. The budget has seen a strategic move done by the government to saddle some savings for property buyers, especially in term of exemption in stamp duty; for instance 100% stamp duty exemption for houses below RM300,000. In order to help the working community ease the burden of home ownership, Employees Provident Fund (EPF) has increased the withdrawal limit from account 2 to about 30% which desirably encourages more people to consider their dreams to come to pass. The idea is to own homes that are able to be leveraged upon, being a long time game plan progressively engaging with the income and savings for property owners and future home buyers. The increase of value for properties are expected from some of the factors drawn out by the government sector and developers to attract a substantial number of new home buyers and secondary homes to fetch below market price, as stability roots in deeper within the market. JANUARY 2017 57



DRIVING THE AUTOMOTIVE INDUSTRY INTO CYBERSPACE Co-founder of shares his ideas on cars, and his first home BY: DIVYA PREMBAJ


ric Cheng loves cars. So much to the point where he decided that the automotive industry needed to keep up with the evolving times, and decided to inherently merge the age-old industry with the modern technological aptitudes of the digital age. was conceived on this idea, and the young entrepreneur has only one way to go – up. FOUNDATIONS SOLID IN ONLINE MEDIA Eric began his career in the online media company Innity, handling digital strategies for media agencies and big brands for eight years. He focused his time as an account director, working out how to strategize and advertise online for his clients, and at the same time sharpening his skills within the diverse industry. It was after spending 58 | JANUARY 2017

the eight years with Innity that brought Eric closer to his dream of merging the automotive and digital industry, after gaining much insight of both industries and honing his ideas. By selling and buying your car online, an avenue is created to alleviate the hassle of car ownership dealings, prompting the best opportunity for Eric and’s chief operations officer Teoh Jiun Ee to materialize their vision. DIGITAL ENDEAVORS When asked specifically why this passion resonates so strongly within him, the young export from Petaling Jaya answers affably

with a light in his eye. “We (with COO Teoh Jiun Ee) had been trying to identify the real issues in the market, and what the industries were lacking. We noticed that there are issues that sellers faced when they tried to sell their cars – and we wanted to come up with a digital solution to help the consumer sell the cars in a more convenient and transparent way.” Considering that this was inherently a novel idea, the company started up as the first automotive website in Malaysia, and

business picked up desirably. Carsome. my is currently operating in four countries – Malaysia, Singapore, Indonesia and Thailand. As most start-ups go, the company initially faced many issues, some ongoing as part and parcel of functioning within the automotive industry. The most underlying challenge lay hand in hand with its biggest success – localization and standardization of the business within four different countries. Cultures, societal norms, language and people proved a tricky aspect to go around, sensitive sentiments that required a lot of tact and forethought. The common challenges of a lack of transparency and pricing issues were doubled in nature, due to these societal factors. SECURITY HURDLES Eric realized from earlier on that all industries need to have some form of innovation, as the market shifts at a rate that is virtually impossible to put a stopper on. However, as with the advent of doing everything online today, security is an issue that plagues many companies. “Society need to be educated that online platforms are inherently trustworthy, as this is one of our biggest challenges when it came to setting up an online platform for this form of service”, Eric affirms. It is the collective mindset that needs to be changed, and it is imperative that society needs to further trust online transactions as this is the way that modernization is shifting the paradigms of the future. ONE STEP AT A TIME Eric firmly believes that tackling the real issues within the market and ensuring their direction, has incessantly kept the young company on its toes during the earlier days of their start-up. “It is crucial to stay relevant in the industry – I read a lot online, learnt from peers, and rely a lot on digital content as everything is current and moves faster,” Eric states in a tone that asserts his beliefs. Staying pertinent to be abreast of everything, especially in this industry where the latest trends conquer the pathways of businesses, is strongly condoned. grew aggressively over the span of a year, and keeping up with its extremely fast paced nature can occasionally be a personal challenge to the

young entrepreneur. “We started out with 4-5 people in the company a year ago, but now we have about 100 over staff (regional, 4 offices). We estimate it’ll grow twice in the future months, “Eric affirms with confidence. Passion and perseverance becomes a mantra, that shapes and molds the young company’s progress within the industry. Eric and his managing team have bright plans for’s future, as the team have already identified the issues in the used car market, and the company aims to carry it forward to more locations. Delving further through sub-cities within the already established four countries is where is progressing to, with goals to extend it as a regional south east Asian automotive hub. With fully fledged branding campaigns through radio in the coming months, along with fundraising campaigns, the company is poised to spread its wings to greener pastures. DIPPING INTO PROPERTIES Currently living in his childhood home in Petaling Jaya, Eric recently delved into the real estate market, and invested in his first property – a landed property in Mont Kiara, under the Sunway Mont Residences project. This is his first property so far, and it was a big leap for the young industrialist, as he knew that he needed to invest in this industry while he is still young and able. “I was not that well versed in the property industry at all. I received lots of

guidance through reviews, testimonials, and extensive research to find a suitable fit for my criteria in buying a property,” Eric admits. The factors that played a strong influence in his decision making were :• Location : making sure that the property in question was located in an easily accessible spot, with MRT and LRT amenities, as well as it being not too far from’s main office in Petaling Jaya. • Thorough research : developers, agents and valuers. To ascertain projects with high quality and positive feedback. • Online forums and reviews : To attain corroborative information from the masses on what to look for, in terms of people’s ideas and on the projects and neighborhoods, as well as the current market outlook of the industry. Eric admits that while he was a newbie in the property investment world, there were a few things that could have been done to make his search easier. A community of investors (young and old) and channels to help future homebuyers, is at the top of his list. “I think a community would be apt, where you could receive information from corporate and brand websites that were available, to help investors decide on neighborhood aesthetics, developers and pricing values,” he affirms. At the tender age of 31, things are indeed moving fast for Eric, but he welcomes it with open arms, and a clear mind’s eye. JANUARY 2017 I 59


THE ALTITUDE OF REAL ESTATE INVESTMENTS IN A FOREIGN SHORE Investors from China have keen eyes to purchase in Thailand, seeing more buyers in forthcoming years

Image Courtesy :


redictions or outlooks derive from knowledge. Political and economic turmoil have caused miffing reactions among the property market players due to weak performances. Thailand’s overall statistics in real estate has not picked up the momentum in 2016. The kingdom’s weak economy also did not seem to offer any support in the short term. Significantly, Thailand has experienced a gradual fall in demand for lower end, compared to the growth in interest for the high and luxury end favouring the investors and end users. There are proactive takes in the condominium market supply within the third quarter which showed the highest number of launches in over a year. As for commercial stands, Thailand has grown in niche for office spaces like serviced offices, mini-offices and homes offices. These are a hike in trend and choice for the new generation of working class. 60 | JANUARY 2017

CAUTIOUS OUTLOOK Thailand is experiencing a languish side of the property market as they undertook a meagre 3.2% growth in the first quarter of 2016, setting as an underperformer as compared to most of its Asian counterparts. The weaker baht (THB) has perpetuated a low investor and consumer confidence level. Developers have positioned themselves well with projects in hand, but being cautious with a continued growth in 2017. Despite that, the effect in Bangkok for exorbitant projects will continue its robust sales with a take up rate of close to 75%. Some of the factors which has led to these uncertainties in the market upheavals is the household debt which has resulted in Thailand being the highest consumer debt nation in all of Asia. Thailand’s household debt shot from 60% - 85% of national income in just over five years. Apart from

that, its agricultural products maintained at a low price has caused a dwindling effect on the confidence of consumers purchasing powers, adversely causing the income to see a declining curve. Premier Homes Real Estate Co., Ltd. managing director, Clayton Wade states “it is needless to say a slow recovery in the real estate sector has been made even more challenged with the passing of Thailand’s beloved King,”. The mourning period had left a sombre and uncertain air which has adversely caused a ripple in the sea of businesses including the real estate industry in Thailand. Consequently, resort areas like Phuket, Hua Hin and Eastern Seaboard have been challenged with slow resale market and slower rental yields, especially from year 2015 till mid-2016. Even though, the supplies of new construction have increased, it took an overturn for the resort

Clayton Wade areas in Thailand with lower rental yield and competitive sales pricing. OPTIMISTIC IN BANGKOK Bangkok has an upscale momentum in its luxury property industry debunked with 300,000THB per square meter being the starting price for luxury condominiums, and 350,000THB per square meter, especially at Bangkok’s latest “Ultra Luxury” landmark named Icon Siam, Mandarin Oriental Residence. Meanwhile, another ultra-luxury market project with Sansiri’s planned 98 Wireless, the city’s most expensive condominium buildings with price tags averaging 550,000THB per square meter. The rental yield in Bangkok is considered one of the highest with an average of 5% according to the property pundits in Bangkok, uniquely in these high-priced areas seeking high yields for capital gains and rental yields. Hot enclaves in Bangkok’s Thonglor area can easily fetch rental yields of 8% with capital gains over 10%, which is impressive compared with the country’s gloomy economy and real estate industry. The capital’s central business district yields an average of 7% around mid-low and high end market categories. There are brighter plans for low and midlevel properties especially with Bangkok Sky train (BTS) and mass rapid transit (MRT) underground rail lines continuing to raise the bar as sales pick up strong, well into the coming years. In Thailand, the demographic of buyers were domestic occupancies consisting of 80% of property purchases, especially in Bangkok while foreign buyers’ hailed from Hong Kong, Taiwan and Singapore, mostly being cash buyers.

Investors from China have keen eyes to purchase in Thailand and will see more of the buyers in forthcoming years. Thailand brokers were expectant, even the number of Chinese investors would surpass that of western countries like Russia. Thai real estate is still admirably positive in outlook, despite the outlandish property trend affecting the country now. It continued to display growth year on year, across pretty much all sectors of the property market. CBDs located in Bangkok with MRT and BDS lines criss-crossing, has a sure bet for high rental yields and return of investments especially in Thonglor area. Specifically, the condominiums have posted between 5% and 12% annual growth in pricing since the world economic crisis in year 2008. The luxury property market which is worth at around 10million THB (US30,000) and posed to be slow in movement, took a surprising turn by attracting foreign investments since 2013. Thailand’s real estate sector is unregulated and at times not obeyed, therefore, it would pay to be a wise investor and to really understand the nook and crannies of the network and how it works within the country. RESOLUTION OR REVELATION As an investor, it will be wiser to know around the locations, amenities, and

accessibilities especially for rental properties. High demographic locations with high competition or restrictions may dampen the abilities to receive a suitable return in the investment. Hence, foreigners are not allowed to own land in Thailand by law. For foreigners, those keen to invest were given options to either purchase through a limited company, or a 30-year leasehold can be arranged. Apartment lots can be owned if 51% are owned by a Thai citizen. Due to this legal restriction, foreigners can settle to purchase apartments or condominiums with more than half of it belonging to a local person. In an overall outlook, Thailand is set to grow at a slower pace than most other nations in Southeast Asia due to the political and economical setbacks, even with the new King taking reign recently. It has underperformed with 3.2% growth in the first quarter of 2016, according to the Bureau of Trade and Economic Indices. The International Monetary Fund (IMF) forecasted that the Thai economy will expand by 3% in 2016, and by 3.2% in 2017. Thailand is looking forward to build it stance in the real estate sector to bracket a strong gross development value to improve its stand within the Asian economic landscape, and cement its name alongside its other Southeast Asia counterparts. JANUARY 2017 I 61



t’s not easy purchasing your first home, or owning your first property. Coupled with the multitude of processes that take place before, during and after, are the many processes that get overlooked. One important aspect that can be missed, is thoroughly checking for defects in your new investment.

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To get a clear understanding of the current property market, check out the infographic:

Image Courtesy :

This article is contributed by, Malaysia’s leading property site JANUARY 2017 I 63


FINANCIAL MANAGEMENT both types of returns. Though this seems simple, but most of us do not take action


etting the basic financial management knowledge and practice right from the start is critical in working our way to achieving financial freedom. In SMART Financing’s dictionary, the term invest means to grow your money in a meaningful way via OPM (other people’s money). In our 3rd series, we will be focusing on how to leverage on good debt – property loan or better known as mortgage. Before we go into the details on why mortgage is a good debt and how does it work towards your benefit, let us find out what exactly is a good debt. A good debt is an investment debt that creates value. Value is gained when the returns grow beyond the cost of your borrowing. One of the benefits which everyone talks about in property investment is the fact that it has the capability of either generating a steady stream of passive income (rental) or simply a handsome one time capital gain. It is probably the only investment where one can expect

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and implement this. Here are some key reasons why mortgage financing creates value: 1. The Power of Leveraging – allow you to purchase a property with only 10% of your money and the rest funded via financing 2. Double Win – property offers both passive rental income and capital appreciation. 3. Cheapest Fund – property financing is the cheapest available financing in town THE POWER OF LEVERAGING Property investment is one of the only few investment tools which allows you to invest with only 10% of the asset value. The remaining 90% can be funded by banks. This means that you invest by leveraging using other people’s money for the whole 90% of the investment. Though you only invest with a mere 10%, and the remaining is being funded, any gain you make is

For example, you purchase a new property from a developer with the price of RM500,000. You only need to pay 10% of the price which is equivalent to RM50,000 as down payment / your capital outlay. The remaining cost of RM450,000 (90%) is being funded by banks. Looking at the house price index chart attached below, price increased averagely at 10% per annum in KL over the last 14 years. Assuming that over the next three years, the property appreciated to a value of RM650,000. That is a gross profit of RM150,000. Assuming expenses on the property is approximately at RM78,000 (including progressive interest, RPGT, MOT, legal fee and stamp duty), you still bring home a good net profit of RM72,000. This is a return of 144% over three years! This is the power of leveraging where you leverage on other people’s money to make more money for yourself!

DOUBLE WIN Property investment is a unique investment tool that allow you to gain on two ways, which is via rental collection and capital appreciation. Do you know that mortgage monthly instalment remains pretty constant throughout the entire loan tenure (assuming the fluctuations of effective lending rate is not significant in the long run / throughout the loan tenure)? But your rental collection will not stays the same due to inflation. Rental is on an upward trend thanks to inflation that is kicking in. When the rental collection surpass your loan monthly instalment, you even start to earn positive passive income! On top of rental yield, you also enjoy capital appreciation on property value. Refer to the below house price index for the last 30 years. In the long run, not only your rental passive income grows, your net worth grows too thanks to capital appreciation on property price. CHEAPEST FUND Property financing is no doubt the cheapest available financing offered in the market. Below are the details of the most common financing options offered by banks and the respective effective interest rates (EIR), clearly, mortgage has the lowest EIR. Mortgage - EIR of 4.5%-5% Personal Loan - EIR of 16%-24% Credit Card - EIR of 15%-18% Car Loan - EIR of 7%-8% Given that mortgage is the cheapest financing in town, one can even consolidate their expensive debts with mortgage. How can this be done? After a few years, your

All House Price Index by State 260 240 220 200 180 160 140 120 100 80 60

1Q 2000 3Q 2000 1Q 2001 3Q 2001 1Q 2002 3Q 2002 1Q 2003 3Q 2003 1Q 2004 3Q 2004 1Q 2005 3Q 2005 1Q 2006 3Q 2006 1Q 2007 3Q 2007 1Q 2008 3Q 2008 1Q 2009 3Q 2009 1Q 2010 3Q 2010 1Q 2011 3Q 2011 1Q 2012 3Q 2012 1Q 2013 3Q 2013 1Q 2014

based on the full 100% value. Leveraging speeds up your property investment journey in a meaningful way! Why? It is because when you choose to fund the property by trying to save money, how long will it take to save the RM500,000? 10 years? 15 years or even 20 years? By that time, property price are likely to have increased to beyond RM500,000! By using the technique of leveraging SMARTly in your property investment journey, you can get into the market today and buy at today’s prices, benefiting from the coming years’ capital appreciation.

Kuala Lumpur




Source: Valuation and Properly Services Department MOF Malaysia, Hsr Research

property would have appreciated in value. You may refinance or apply for top-up loan to cash out the equity you have gained on the property price appreciation. The cash out you obtained from refinancing or topup can be used to pay off your existing expensive loans like personal loans and credit card debts. On top of that, the access cash out allow you to have additional cash on hand and it may be kept as a standby cash or emergency funds. Life is fraught with rainy days; from car breakdowns to illness and job loss and every one of them is costly. You will be in a much better position to weather economic storms with available cheapest funds than without. This money would become handy in needy times. Cash is king, and thanks to banks in having a “Flexi-Mortgage” product. This product has given some advantage to us and a blanket during recession. By borrowing more / cash out from your capital gains, you stand to gain the following benefits 1. You have standby cash on hand to repay your monthly instalments during times which you cannot afford it. 2. Having standby cash while not

incurring higher interest compared with personal loan or credit card or any other cash loan. Leaving your additional cash in your flexi mortgage account will ensure you do not get charged when you are not utilising the cash. 3. Unlock your investment potential when you see future investment opportunity. Your next down payment funds are ready to be used. Lastly, you must also remember that at the end of the day, it all boils down to SMART planning, SMART execution of SMART strategies. There are also risks in leveraging to invest in properties. First and foremost, you must be certain that you can service all the mortgages you’re taking out, otherwise you might not just lose some or all your assets and go bankrupt. Secondly, investing into great properties is of the utmost importance. Great property always gives you the best return at good times and does not fail you even at bad times. The key is to equip yourself with the right knowledge and experience and always make an informed decision to benefit yourself to the optimum level!

ABOUT THE CONTRIBUTOR Gary Chua runs workshops to educate people on latest winning formulas to stay ahead in these trying times! Please go to to get the latest updates on upcoming events. He always welcomes feedback and valuable sharings. Please feel free to drop him an email at or connect via social media at JANUARY 2017 I 65



First and foremost, you need to have some monies in your pocket before you commit to any home purchase. You need to provide for the initial booking, deposit, professional fees, stamp duties, property valuation fees etc depending whether you are buying from the Housing Developers or the secondary

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market. It is almost impossible to get 100% financing to fund your entire home purchase in the market place. Your initial monies can be your own savings, your friendly loan from friends and family, your advance salaries from your employer, personal loan from the Co-operative that you are a member to; to even the permitted withdrawal from your

EPF contribution that is allowed for first home purchased. If you are qualified, you might want to explore the various schemes announced under the Budget of the last few years from the very early Skim Rumah Pertamaku to the most recently, MyDeposit scheme announced last year. Banks are the obvious choice to take care of the rest of your home financing

requirement. However, housing loan are also available from the Insurance Companies, Licensed Finance Companies, Licensed Money Lenders as well as Building Society although the interest rates, margin of financing, loan tenure, loan repayment and requirements are all unique respectively and not the same as the banks. If you are a civil servant, you can even apply for housing loan from the Government.

2. When to look for Financing?

It is always a good practice to look for financing before you commit to a home purchase. There are also many variances of home financing packages in the offering and you can always shop early to identify package that suit your needs. First you need to get your set of proof on incomes ready so that you can start checking with the Banks on the indicative range of loan amount that they are ready to grant you to finance your intended home purchase. This is extremely helpful to assist you to short list properties that are within your affordability and credibility with the bank. Otherwise, you might misinterpret your own credibility and ends in disappointment. Pay a visit to Bank Negara and conduct a check on the CCRIS system will also be helpful to ensure your intended loan application is smooth without any unnecessary remarks in your record. PTPTN is another marker too for those of you who have got a loan to finance your study. If you are buying from the secondary market, do not take too long to shop for the best financing package as you are required under the normal transaction time of 3 months to pay the balance purchase price or you are subjecting yourself to late payment interest or even at risk of a termination with forfeiture of your deposit too. If possible, sign your set of Loan Agreement as soon as you signed your Sale and Purchase Agreement, preferably no longer than 2 weeks after that.


Who to borrow? This is not the same question as to who to buy. Although it might seems obvious

that the person who buy should be the one who borrow, they are some strategic consideration involved. Borrower can be an individual, a group of individuals as borrowers, a Sdn Bhd, a Bhd or even a Limited Liability Partnership (LLP). It could also be a borrower with the homebuyer providing a third party security in term of charging the home so purchased to the bank. The loan approval, the margin of financing, the loan tenure, the rate of interests are all depending on the profile of the borrower. Typically, joint borrowers with multiple incomes would have better chance of loan approval than a single income single borrower. A income earning husband would be welcomed as a borrower for a case where the home is purchased under the name of the housewife with no income. The persons with better financial standing could either be one of the borrowers or one of the guarantors. If the Borrower is a Sdn Bhd, Bhd or a LLP, it is also normal for the Directors or Partners to give joint and several guarantee for the loan too. Using a company to buy a home of residential purpose would definitely means a lower margin of financing that requires the purchaser to have a larger sum of initial monies.

4. What type of Financing?

There is no such thing as the standard home financing package as there are many different offerings in the market to cater for the various needs of the borrowers. For a start, there are the conversional loan as well as the Islamic financing that operates on syariah compliance principles but available to all including non-muslim. Within the conventional sphere, pay attention to the details in things like, term loan, flexi, overdraft, daily rest interests, principal reduction, early redemption

penalty, effective lending rate. Take your time to understand the unique features of the housing loan packages on offer to you and select one that most suited to your unique profile to make the most out of it in your favour. Pay attention to the various conditions for the disbursement of the loan sum for little thing like opening of a new bank account could delay your progress in completing the home purchase that might potentially means you need to late payment interests.


How to select your Financing Package? If you are buying from the Housing Developers, most of the time there will be a panel of Banks that are ready to consider your loan application strictly based on your profile. Unlike the secondary market, there is a need to have a property valuation report to be done on a case to case basis to satisfy the lending Bank along with your profile as a borrower. You need to also approach the banks on your own, although the real estate agents as well as your lawyers might give you professional references within their network. Consider you unique need in financing, your preferred income and repayment pattern as well as your objective in your home purchase to enable your best selection of the home-financing package. There is no best loan package universally but there is certainly one package that works best for you. As for the need of Mortgage Insurance like MRTA/ MLTA, it is your discretion unless it is prescribed by the loan package as a condition for approval. The premium involved could actually be part of the loan sum or you can choose to pay with your own fund. There are pros and cons in Mortgage Insurance and it is certainly worth considering for a genuine homebuyer.

ABOUT THE CONTRIBUTOR Chris Tan is the Founder and Managing Partner of Chur Associates, Advocates, & Solicitors. He is deeply involved in the real estate industry, and is now the honorary Legal Advisor for FIABCI Asia Pacific Regional Secretariat on regional concerns. JANUARY 2017 I 67


MALAYSIA BUDGET 2017 – KEY HIGHLIGHTS Accelerating Growth, Ensuring Fiscal Prudence, Enhancing Well-being of the Rakyat

PROPOSED CHANGES 1. Enhance First Home Buyer’s Affordability • Through the National Blue Ocean Strategy (NBOS), the government will provide vacant lands at strategic locations to GLCs and Perumahan Rakyat 1Malaysia (PR1MA) to build more than 30,000 houses. The selling price will be between RM150,000 to RM300,000. • 10,000 houses in urban areas will be built for rental to eligible youth with permanent jobs including young graduates entering the labour market. They may rent up to a maximum of five years, at a lower than market rate. • To build 5,000 units of People’s Friendly Home (PMR) with the Government subsidising up to RM20,000 per unit. 68 I JANUARY 2017

2. “Step-up” End Financing Scheme for the PR1MA Programme • Through this special scheme, financing will be easier and more accessible to the buyers with a total loan up to 90% to 100% with loan rejection rate reduced drastically. • Stamp duty exemption be increased to 100% on instruments of transfer and housing loan instruments, compared to 50% at present. This is only limited to houses with the value up to RM300,000 for first home buyers between 1 January 2017 and 31 December 2018. 3. Upgrade Public Transportation in Rural Areas • Implementation of the new East Coast Rail Line project connecting Klang Valley to the East Coast, in phases.

The 600km rail will connect townships such as Port Klang, ITT Gombak, Bentong, Mentakab, Kuantan, Kemaman, Kerteh, Kuala Terengganu, Kota Bahru and ends in Tumpat, with an estimated cost of RM55 billion. Increase the trip frequency of ETS for the Johor Bahru – Padang Besar, involving procurement of nine train sets till 2019, with an overall allocation of RM1.1 billion. Accelerating the implementation of Pan Borneo Highway in Sabah and Sarawak.

4. Increase in Stamp Duty • The rate of stamp duty on instruments of transfer of real estate worth more than RM1 million, will be increased from 3% to 4% effective 1 January 2018.

4. Increase in Stamp Duty • The introduction of higher stamp duty is likely to have an adverse effect on investors when introduced in 2018 similar to the impact of GST on retail. • In the shorter term, it is likely that more transactions above RM1 million may be done before the implementation date. • Developers may resort to selling slightly below the RM1 million threshold to avoid the tax after 2018.

IMPACT 1. Enhance First Home Buyer’s Affordability • This would help to alleviate the shortage of affordable homes and allow the middle-income citizens to own a house. • It will increase property ownership and spending of the rakyat on related housing products. • Construction companies and some developers are likely to be the beneficiary of these budget announcements. • We expect these projects to spur domestic investment activity which will contribute to the GDP supported by both private and public investment. 2. “Step-up” End Financing Scheme for the PR1MA Programme • This will help the rakyat who faces difficulty obtaining loans as the current approval rates by the banking industry currently stands around 40% only. • The stamp duty exemption is likely to spur property investments to take place in 2017. • This will help to contribute to stronger construction and economic activities in 2017. 3. Upgrade Public Transportation in Rural Areas • The East Coast Rail line will support the industrial areas in Pahang, Terengganu and Kelantan.

The additional trains between Padang Besar and Johor Bahru will help to ease the increased demand for travelling along the west coast of the Peninsular. RM100 million allocated to restore the East Coast railway line along Gua Musang – Tumpat that was destroyed during flood. The Pan Borneo Highway will help to increase tourism and economic activities between the states of Sabah, Sarawak and Brunei.

“The 2016 Budget is pro-poor targeting the rural poor, fishermen, women, students as well as those in the civil service like the army, the navy, air force and the Police. The budget for handouts like BR1M were raised, low-cost housing was made available for both home buyers and tenants. Infrastructure spending was given priority in the form of a railway line for the East Coast as well as an additional nine sets of train from Padang Besar to Johor Bahru. The spending is expected to help boost domestic demand and stimulate growth, thereby raising GDP to 5% in 2017 as opposed to an expected growth of 4% to 4.5% in 2016. The Government continued to restrain spending and has budgeted for a 3% fiscal deficit,” says YY Lau, Country Head, JLL Malaysia.

ABOUT THE CONTRIBUTOR JLL is a professional services and investment management firm offering specialized real estate services to clients seeking increased value by owning, occupying and investing in real estate. JLL’s research team delivers intelligence, analysis and insight through market-leading reports and services that illuminate today’s commercial real estate dynamics and identify tomorrow’s challenges and opportunities. JANUARY 2017 I 69




alaysia recorded a total of 102,096 residential property transactions in the first half of this year valued at RM32.71 billion. This is a decrease from 119,446 transactions valued at RM36.46 billion for the same period last year. The second half of this year is expected to also record a decrease compared to the same period in 2015. This drop in residential property

70 I JANUARY 2017

transactions can be attributed to various factors, but one of which is the increasing property prices that had sailed above the affordability of the average Malaysians. This coupled with the difficulty in obtaining housing loans has attributed to a slowdown in the property industry, particularly in the primary market. Financial Planning Association of Malaysia’s (FPAM) Certified Member

Michael Geh, who is also a chartered surveyor and senior partner in Raine & Horne International Zaki + Partners Sdn Bhd, discussed here the current situation in the property industry and his views on the proposed financing models to assist home buyers. Q1: The Housing Minister has suggested that developers be allowed to offer loans

to home buyers. How will this impact the industry? A: The main business and objective of property developers is to procure development land, prepare it for construction and come up with a product that they could gain a profit from in order to meet its board of directors and shareholders return on investment objectives. The provision of loans to home buyers and property investors are now under the purview of banks and financial institutions. However, this business ecosystem came under pressure when property and home prices hit an all-time high, especially in recent years. On the other hand, the income of a majority of Malaysians have not increased in tandem with the property prices, so the highly priced properties are now out of their reach. This is when the term “affordable” and “unaffordable” property prices became a common property industry jargon in recent years. The Housing Minister’s call was to allow developers to offer loans to home buyers and investors via licensed moneylending entities. The licensed moneylending entity has interest calculations that are high, thus is more suited for short term personal loans of between 3 to 5 years. The interest and principal sum have a tendency to balloon up over a longer tenure. This type of loan by the developers, as explained by the Housing Minister, is more suited as a loan to bridge the gap or shortfall between the housing loan amount approved by financial institutions and the sales and purchase price. I agree that this type of loan is best suited as a “gap financing model” to assist home buyers to make the shortfall to purchase their homes. However, this type of loan should not be used to fully finance the home purchases or to replace existing housing loans offered by banks and financial institutions. I still believe that the main bulk of housing loans should be disbursed by banks and financial institutions that are best suited for home buyers. Q2: What is your view on the current policy by Bank Negara on the offer of housing loans only to qualified buyers? A: Bank Negara advises banks and financial institutions to exercise prudence in the disbursement of loans to property retail sector’s qualified home buyers. This advice has been in force for two years now.

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This plus a few other market forces ended the more than a decade of “Super Property Bull” run in the Malaysian property market. This “Super Property Bull” run has also resulted in the peaking of property prices in the developers’ direct sale products, namely the primary market. Currently, the prices of the primary market are at an alltime high. The activity and transactions in this section of the market have declined to industry alarming levels. In the meantime, the secondary property market, which is the resale market, has also seen reduced volumes coupled with reduced pricing in speculatively held properties. Nonetheless, this segment of the market is still healthy as home buyers have been able to secure loans for their purchases. Q3: What is your view on the call to EPF to increase the amount allowable to be withdrawn from Account 2 for property purchase? A: Buying a home is an important pillar of wealth in a family. Therefore, current policy for home buyers to withdraw from their EPF Account 2 to purchase their own homes

is sufficient. The account holder should, with the help of the professionals at EPF’s Retirement Advisory Service (RAS), look at what they can afford to buy based on their eligible withdrawal amount. Otherwise, it may be good to defer the withdrawal until there is sufficient amount to withdraw before purchasing the desired residential property or consider one that is within the account holder’s eligibility. After all, this money is earmarked for their retirement and if home buyers dip into their retirement fund, they will have even less in retirement. As it is, most people find that depending solely on their EPF savings for retirement is not enough. On a final note, new home buyers must also fully understand the full home purchase process before they make the final decision. It is best that potential home buyers learn about Financial Planning Methods so that they are able to assess their capabilities and affordability in purchasing their first home. It is after planning out their financial situations, that they are able to plan out the necessary steps towards signing on the dotted lines in the sales and purchase agreements.

ABOUT THE CONTRIBUTOR Michael Geh Thuan Peng is a Certified Member of The Financial Planning Association of Malaysia (FPAM) and currently the Vice-President of FIABCI Malaysian Chapter. He has been involved in the property consultancy for 25 years and has written two Property Investment Guide Books. JANUARY 2017 I 71




Do remember that your tenants are your customers and, ideally, you would like them to remain so


eeping up to date with rental values is critical to knowing how your property is performing and whether more income could be extracted from your asset. A boom in the rental market means prices can change quite significantly in a short period of time; this is especially the case in some parts of Kuala Lumpur. It is advisable therefore to check the rental you are receiving against the current market rate. If there is a major discrepancy (up or down), you should investigate this further and find out the reasons for this. Rents can go down as well as up and it is important that you are prepared for this should the tenant vacate. If a rental property is let for noticeably less than the current market rate, the amount should be reviewed. If a tenant has vacated a property and there is going to be a new let, then the decision to increase the rent is a simple one; the rent should be increased in line with current market rates. However, if the property is currently tenanted, you should take into consideration a number of factors before increasing the rent: • Check the Tenancy Agreement to ensure you are permitted to increase the rent during the tenancy period. • Review your current tenants and assess their status. Consider such things as: the condition of the property and how they look after it, how long they have lived there, payment history, and how much you like doing business with them. • Assess how your current tenants may react to a price increase. Can they afford for you to increase the rent? If the price increase may mean they can no longer afford the property, are you prepared to lose them as tenants? • Calculate the cost of a new tenant. In addition to any letting fees and void periods, a property rented to a new tenant will most likely require additional works. Existing tenants can be quite forgiving of internal decor items; however, this is often not 72 I JANUARY 2017

the case for new tenants, especially when you are looking to achieve a higher market rate. • Evaluate if the hassle is worth the extra money? Consideration should be given to the time and costs involved in starting new tenancies. There are usually some issues that arise and these should be weighed up against existing tenancies, particularly if the current tenants have been in situ for a long period of time, are reliable and look after the property. If, having assessed the market and reviewed your tenants, you feel a price increase is warranted, it is best to discuss this with them. In my experience, tenants want to feel part of the negotiation process rather than just being told of the new increased rent. It is important to remember that your tenants are your customers and, ideally, you would like them to remain so. Personally, I am a strong believer in renting properties just below current market rates. This discounted pricing strategy ensures my rents are competitive and, I have found, tends to attract longerterm tenants. Moreover, the cost savings enjoyed by the tenants mean they are more likely to spend additional funds on enhancing a property. This strategy has rewarded me well with the majority of my tenants staying with me for many years. Much so at this challenging year, replacement of tenant will not come easy.

ABOUT THE CONTRIBUTOR Dato’ KK Chua is the strategic advisor & managing director of Armani Media. He is also a registered real estate agent and an investor with more than 10 years of experience in the industry. He can be contacted at

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Property Insight January 2017  

Property Insight is a monthly property investing magazine.

Property Insight January 2017  

Property Insight is a monthly property investing magazine.